New Delhi: Government will sell 5 percent stake in Rural Electrification Corporation Wednesday at Rs 315 a share to mop up over Rs 1,550 crore, marking the first disinvestment of the current fiscal.
The floor price of Rs 315 a share is at a discount of 2.07 percent over the closing price of Rs 321.65 a share.
The price for the offer for sale (OFS) of 4.93 crore REC shares was decided today at a meeting headed by Finance Minister Arun Jaitley.
The Floor Price of the Offer will be Rs 315 per equity share, the company said in a filing to the BSE.
The offer will take place during trading hours on a separate window of the stock exchanges on April 8 between 9.15 am and 3.30 pm, REC said.
REC scrip closed at Rs 335.60, down 4.16 percent on the BSE. The 5 percent share sale would fetch over Rs 1,552 crore to the exchequer.
As much as 20 percent of the offer size would be reserved for retail investors, who can bid for shares worth Rs 2 lakh. They would be offered shares at 5 percent discount to issue price.
Besides, 25 percent of the offer would be alloted to mutual funds and insurance companies.
REC would be the first PSU to hit the market in the current fiscal. The government has budgeted to raise Rs 41,000 crore through minority stake sale in 2015-16.
The disinvestment department has a pipeline of companies to sell minority stake to avoid bunching up of disinvestment towards the end of end of the fiscal.
The companies which have been lined up for disinvestment include BHEL, Dredging Corporation, NALCO, IOC and NMDC.
"It is not very healthy to bunch stocks towards the end of fiscal because then you cannot watch the market and there is limited depth in market. So one may not get the full worth also. We will not bunching them together," Disinvestment Secretary Aradhana Johri had said earlier.
J M Financial, Morgan Stanley and IL&FS Broking Services are acting as merchant bankers to the REC issue.
In 2014-15, government had raised about Rs 24,500 crore through disinvestment.
