The follow-on public offer of Power Finance Corporation (PFC) got fully subscribed on the third day of its issue. Today is the last day for subscription for institutional investors. However, the issue is open tomorrow for retail investors and employees.
The PFC issue was subscribed 3.58 times — received bids for 82.13 crore shares as against 22.955 crore shares on offer, according to data available with the NSE. Of this, 2.13 crore shares were bid at cut-off price. (Cut-off price is the actual discovered issue price of the issue that can be any price in the price band or any price above the floor price.). The qualified institutional investors' portion is subscribed by 6.55 times while rest of the categories are yet to show any interest in the FPO.
The price band for the offer has been fixed at Rs 193-203 a share.
The power company plans to raise about Rs 4,700 crore through the follow-on issue. It offers a discount of five per cent for the retail investors and employees. Retail portion is subscribed by 0.22 times so far, according to the NSE.
The offer comprises of a fresh issue of 17.21 crore equity shares and an offer for sale of 5.73 crore equity shares by the Government that holds about 89.78 per cent stake in the company.
The Power Finance Corporation follow-on offer is the first divestment by the Government in the current financial year. It may recalled that the Union Finance Minister had set a disinvestment target of Rs 40,000 crore for the current financial year.
PFC plans to use the proceeds of the issue to augment its capital base to meet capital adequacy norms.
The PFC stock slipped 0.92 per cent to close at Rs 215.95 on the NSE with 6.73 crore shares changing hands. About 60 per cent of traded shares were up for delivery.