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NHPC Share Sale Starts, Stock Slips Below Issue Price

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The government's 11.36 per cent stake sale in electricity generator NHPC on bourses took off today, with the scrip slipping 6.72 per cent in line with the broader market trend and going below the floor price. The floor price of Rs 21.75 for the offer for sale (OFS) was at a discount of 5.64 per cent over yesterday's closing price of Rs 23.05 on BSE.

NHPC Share Sale Starts, Stock Slips Below Issue Price
However, in morning trade, the scrip lost Rs 1.55 a share, or 6.72 per cent, to a low of Rs 21.50. The OFS is open to institutional investors today and bidding will continue till 1530 hours. The government is selling over 100.61 crore shares in NHPC to institutional investors at the floor price of Rs 21.75 today. The remaining over 25.15 crore shares will be sold to retail investors tomorrow.
 

Retail investors, who will be allocated shares at a discount of 5 per cent to the cut-off price, are individual investors who place bids for shares of total value of not more than Rs 2 lakh. NHPC is the first PSU stake sale of the current fiscal and also the first share sale of the Department of Investment and Public Asset Management (DIPAM), earlier called Department of Disinvestment.

The government is selling over 125.76 crore equity shares of NHPC representing 11.36 per cent of the total paid-up equity share capital. At a floor price of Rs 21.75, the sale will fetch about Rs 2,700 crore to the exchequer. The government holds 85.96 per cent in NHPC and the sale would help it comply with the minimum public shareholding norm.

The government has set an ambitious target of Rs 56,500 crore from disinvestments in current fiscal. Of this, Rs 30,000 crore is to come from PSU stake sale and the remaining Rs 26,500 crore from strategic stake sale. NHPC, under the administrative control of the Power Ministry, is into generating power through conventional and non-conventional sources and is dedicated to planning, development and implementation of an integrated and efficient network of power projects in India.

PTI

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