Mumbai: As part of the divestment process, government will divest 10 per cent of its stake in the public sector chopper-maker Hindustan Aeronautics, which on Tuesday launched a Rs 4,230-crore initial public offer.
Govt to sell 10% stake in HAL via `4,230-crore public offer
As part of the IPO that hits the market on March 16, the Maharatna company will also sell 10.20 per cent of its equity through and offer-for-sale route.
The firm, which gets over 91 per cent of its sales from the defence sector including the Coast Guard, has fixed a price band at Rs 1,215-1,240 per equity share for the offer that will hit the market on March 16 and close on March 20.
The sale is part of the government's Rs 75,000-crore divestment process, which for the first time in many years, has already crossed the target.
The proceeds from the stake dilution is important as government badly needs to meet the 3.5 per cent fiscal deficit target set for the year. As of end January the government had already used 113 per cent of the same, therefore the urgency.
The company, which made a profit of Rs 3,580 crore in financial year 2016-17 on a revenue of over Rs 18,600 crore, is offering a discount of Rs 25 on offer price to retail individual bidders, and employees which have come in for at least 12 or the multiples of 12 shares.
The IPO will see the company selling 34,107,525 equity shares of face value of Rs 10 through an offer for sale by the President, acting through the department of defence production under the defence ministry.
The offer comprises a net offer of 33,438,750 equity shares and an employee reservation of up to 668,775 shares.
The offer and net offer shall constitute 10.20 per cent and 10 per cent, respectively, of the post-offer paid-up equity share capital of the Bengaluru-based HAL.