Govt to sell additional 1% Coal India stake after OFS gets oversubscribed 8 times

The government will exercise the entire greenshoe option in the ongoing offer-for-sale (OFS) of Coal India after the issue received strong investor demand and was oversubscribed 8.14 times on the first day, according to an official statement on Wednesday.

Allocation in the OFS will be done on a price-priority basis, while retail investors and eligible employees can place bids on May 29.

The Centre had on May 27 launched the OFS to divest up to a 2% stake in Coal India through a base issue and greenshoe option. The offer opened for non-retail investors on May 27 and will open for retail investors on May 29.

The government had fixed the OFS floor price at ₹412 per share, a discount of around 10.1% to Coal India’s closing price on May 26.

The base offer consisted of up to 1% of Coal India’s paid-up equity share capital, translating into an issue size of nearly ₹2,539 crore at the floor price. With the full exercise of the greenshoe option for an additional 1% stake, the total issue size could rise to around ₹5,078 crore.

DIPAM Secretary Arunish Chawla had said Coal India remains an attractive long-term investment opportunity backed by strong operational and financial performance, steady shareholder returns and robust dividend payouts.