SAIL OFS’ retail portion subscribed 5x on day 1

Mumbai: The Rs 2,600-crore offer for sale (OFS) of Steel Authority of India (SAIL) by the government received a strong response from both institutional and retail investors. The institutional portion, opened for subscription on Thursday, received bids more than 4 times the shares on offer, while the portion reserved for retail buyers was subscribed about five times Friday.

The government had planned to sell 206.5 million shares, or 5 per cent of the total equity, with an option to sell an additional 206.5 million shares of SAIL in case of oversubscription.

Seeing strong response to the offer, Tuhin Kanta Pandey, secretary, Department of Investment and Public Asset Management (DIPAM), said that the government has decided to exercise the green shoe option.


“The OFS of SAIL closed with strong interest from retail investors. Retail portion was subscribed about 5.22 times. We thank all investors for their participation and making the transaction successful,” Pandey said on Friday.

"Offer for Sale of govt shares in SAIL got great response on day one. Issue subscribed 4.14 times of base size at a clearing price above the floor price by non- retail investors. The governmentt has decided to exercise the green shoe option. Retail investors get chance to bid tomorrow," he had said on Thursday, when the offer opened to non-retail investors.

The floor price of the offer was fixed at Rs 64 per share, a discount of 13.63 per cent to Wednesday’s closing price of Rs 74.70. However, the clearing price was fixed at Rs 65.65 for non-retail bids.

Of the 206.5 million shares on offer, 180.7 million have been reserved for non-retail investors and 25.8 million for retail investors.

Shares of SAIL rallied 4.3 per cent on Friday to close at Rs 70.20. The SAIL OFS is part of the government’s disinvestment programme through which it is targeting to raise a record Rs 2.1 lakh crore in the current fiscal ending March 31, 2021.

So far, the government has raised Rs 28,298.26 crore from disinvestment proceeds.