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The centre on Tuesday said that it will sell up to 1.5 per cent of its stake in Oil and Natural Gas Corporation (ONGC) through the offer for sale (OFS) route. The OFS is expected to fetch the government around ₹3,000 crore and the issue opens on Wednesday.
Meanwhile, the Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandeyin a tweet said, “Offer for Sale’ for 1.5 per cent equity stake sale in ONGC, including 0.75 per cent Green Shoe option opens on Wednesday. Retail investors can bid on Thursday.”
In a regulatory filing on stock exchanges, ONGC said, “Notice of the proposed offer for sale (OFS) of equity shares of face value of ₹5 each of ONGC by its promoter, the President of India, acting through the Ministry of Petroleum and Natural Gas (MoPNG), through the stock exchange mechanism.”
The promoter proposes to sell up to 94,352,094 equity shares of the company on Wednesday to non-retail investors and to retail investors on Thursday with an option to additionally sell 94,352,094 equity shares in case of over subscription, it added.
The floor price for the OFS has been set at ₹159 per share. The government owns a 60.41 per cent stake in ONGC which produces half of India’s oil and gas.
In the OFS, a minimum of 25 per cent shares have been reserved for mutual funds and insurance companies while 10 per cent is earmarked for retail investors, who are defined as an individual investor who bids for not more than 2 lakh shares. ONGC employees too can apply for equity shares of up to ₹5 lakh each. The 0.075 per cent of equity shares sold in the OFS will also be offered to eligible employees at the cut-off price.
ONGC’s OFS comes at a time when the centre is likely to close the current fiscal with disinvestment receipts far short of the ₹75,000 crore that it had looked to mop up at the revised estimate stage this fiscal. The much anticipated LIC IPO is now only slated for the next financial year. So far the government has been able to mop up around ₹12,000 crore though disinvestment.
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