The Government's move to divest its stake at a premium in Rashtriya Chemicals and Fertilizers (RCF) through offer-for-sale seemed to have been justified as the issue sailed through at the closing hours on Friday.

The Centre, which had planned to sell 6.9 crore shares through this auction, received bids for 8.89 crore shares at an indiciative price of Rs 45.02, which is almost equal to the floor price fixed by the Government.

At this price, the Government could mop up over Rs 310 crore from the disinvestment.

The floor price values the stock at 7.7 times its FY’14 earnings, translating into a 12 per cent premium to its competitor Chambal Fertilisers.

RCF, a leading urea producer, also manufactures complex fertilisers and industrial chemicals such as methanol and methylamines.

The Govenrment will now set its eye on other PSUs.

While the stake sale in MMTC is expected on March 14, Nalco and SAIL will follow suit immediately. The SAIL issue alone is expected to garner over Rs 3,000 crore.

(This article was published on March 8, 2013)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.