Mumbai, August 25: Shares of state-owned Hindustan Copper Limited (HCL) have declined up to 7% in morning trades on August 25 after the central government’s Offer for Sale (OFS) went live to divest up to a 6% stake in the public sector miner.
The transaction aims to raise approximately ₹3,000 crore ($360 million) for the government as it looks to meet its divestment targets for the current fiscal year. The government currently holds a 66.14% stake in HindCopper, and this divestment will take its stake to under 60%.
The government has set a floor price of ₹514 per share for the OFS, representing a 10% discount to HCL’s previous closing market price. The OFS has opened for institutional investors today, with retail and eligible non institutional buyers eligible to bid on Wednesday, August 26.
In its official notice submitted to the stock exchanges, the Department of Investment and Public Asset Management (DIPAM) outlined the terms of the transaction:
“The promoter (Government of India) proposes to sell up to 2,90,14,350 equity shares of face value ₹5 each, representing 3% of the total paid-up equity share capital of Hindustan Copper Limited, with an option to additionally sell up to 2,90,14,350 equity shares (representing 3% of the total paid-up equity share capital) through an Offer for Sale.”
“The allocation to retail investors will be made at a discount of 5% to the cut-off price determined in accordance with SEBI guidelines, with 10% of the total offer size reserved for retail bidders.” it further added.
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