Millennium Post

Offered at throwaway rate, SAIL’s 5.82% sale fully subscribed

Aided by LIC's bulk purchase, the government's truncated disinvestment in SAIL on Friday  managed to go past the muster and help take the year's proceeds from PSU stake sales to Rs 23,920 crore.

The 5.82 per cent or 24.03 crore government share sale of SAIL barely managed to scrape through at the close of market hours on Friday with foreign investors putting in only about Rs 200 crore.

Data available from the stock exchange showed the issue was not fully subscribed at the close of trading hours.

However, the final figures posted after an hour showed bids for 24.13 crore shares.

Sources said 50 per cent of the total bids came in from insurers, including a hefty demand from Life Insurance Corporation (LIC).

The Offer For Sale (OFS) received bids for 24.13 crore shares at an indicative price of Rs 63.07 apiece, fetching the government Rs 1,516 crore. SAIL shares closed at Rs 63.40, down 0.78 per cent on the BSE  on Friday.

An inter-ministerial panel had earlier this week decided to halve the SAIL offer size to 5.82 per cent from the earlier planned and Cabinet approved 10.82 per cent, amid a weak trend in the stock market.

SAIL stake sale was the last disinvestment for the current fiscal, ending on 31 March. With this, disinvestment proceeds would go up to around Rs 23,920 crore, the highest ever realisation on disinvestment front in a single year, missing the Rs 24,000 crore target by a whisker.

The government has sold stake in seven companies— NMDC, Hindustan Copper, Oil India, NTPC, RCF, Nalco and SAIL —in the current fiscal. The proceeds from disinvestment would help government bridge its fiscal deficit which is estimated to be 5.2 per cent of GDP in 2012-13.
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