Govt sets 10% IOC share sale at 1.8% below market price

 The Government on Saturday fixed the floor price for selling its 10 per cent stake in Indian Oil Corporation (IOC) at Rs 387 a share — about 2 <g data-gr-id="22">per cent</g> below last closing — which is likely to fetch Rs 9,302 crore to the exchequer. The Government, which holds a 68.6 <g data-gr-id="23">per cent</g> interest in IOC, will sell 24.28 crore equity shares through an offer for sale (OFC) on Monday.

“... the floor price for the sale in terms of the Sebi OFS Circular shall be Rs 387 per equity share of IOC,” the Government said in a regulatory filing. The price fixed is 1.8 <g data-gr-id="20">per cent</g> lower than Friday’s closing of Rs 394.45 per IOC share on the BSE. At the floor price, the Government, after considering 5 <g data-gr-id="21">per cent</g> discount being offered to retail shareholders, will garner about Rs 9,302.21 crore. IOC’s share sale will be the fourth disinvestment this fiscal, but the biggest so far in 2015-16.

The earlier three stake sales have raised about Rs 3,300 crore. The IOC stake sale will, however, <g data-gr-id="28">dwarf</g> in front of Rs 22,557 crore that the government raised through a stake sale in Coal India Ltd last year. The Government is targeting to raise Rs 69,500 crore from disinvestment in the current fiscal.

IOC is the nation’s biggest oil refining and marketing firm with 54.2 million tonnes of refining capacity or roughly one-fourth of India’s total refining capacity of 215.1 million tonnes. Besides, it owns and operates 24,405 petrol pumps — a little less than half of India’s 53,419 filling stations. The OFS will open at 9:15 am on Monday and close on the same day at 3:30 pm. At least 20 <g data-gr-id="27">per cent</g> of the <g data-gr-id="25">offer</g> size is reserved for retail investors.