Shares of Rural Electrification Corporation (REC) fell nearly 4 percent intraday Tuesday ahead of stake sale by the government.
The government will sell 5 percent stake in REC on April 8 to mop up close to Rs 1,600 crore, marking the first disinvestment of the current fiscal. Taking the offer for sale (OFS) route, government will sell over 4.93 crore REC shares.
“The offer shall take place during trading hours on a separate window of the stock exchanges and shall commence on April 8,” REC said in a filing to the BSE.
The government is likely to fix the floor price for the OFS at a discount to the current market price.
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 per cent 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.
J M Financial, Morgan Stanley and IL&FS Broking Services are acting as merchant bankers to the issue.
At 09:49 hours IST, the scrip of Rural Electrification Corporation was quoting at Rs 324.90, down Rs 10.70, or 3.19 percent on the BSE.
(With inputs from PTI)
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