NTPC FPO subscribed 0.77 times, gets maximum bids at Rs 209

NTPC's follow-on pubic offering (FPO) was subscribed 0.77 times on its opening day on Wednesday, with most of the bids at Rs 209 a share.

The floor price had been fixed at Rs 201 a share. The stock, which had been falling steadily since mid-January and had lost 10 per cent until now, rose 1.82% on the BSE to close at Rs 209.80 on Wednesday.

The retail reservation was 35% or 7.86 crore shares and brokers said that getting this portion fully subscribed may not be easy for the company. The non-QIB segment (retail and HNI) had bid for only 32,760 shares, the reservation for High Networth Individuals and retail being 20.80 crore shares.

"This portion is really huge, close to Rs 1,500 crore, bigger than most of the IPOs which are hitting the market now. The issue's floor price is Rs 201 and even seeing the highest bid price, retail are not seeing much of an upside," said the head of research at a brokerage.

According to a merchant banking source, the 50% portion reserved for the Qualified Institutional Buyers (QIB) was fully subscribed. "Among the QIBs, SBI and LIC bid for shares worth Rs 4,760 crore", said the source.

The 41.2-crore share issue received bids for 31.9 crore shares, of which 21.83 crore shares were bid for at Rs 209. For retail and high net worth individuals the floor price had been fixed at Rs 201 while qualified institutional buyers (QIB) could bid any price above this level.

At the floor price, the issue received bids for 29.78 lakh shares while the maximum bid price was Rs 210, for which 24.14 lakh shares were placed.

The FPO will close on February 5. Through this divestment, the Government will offload five per cent of its stake in NTPC and its holding will come down to 84.5%.

REC follow-on offer

REC will be the next Government- owned entity to come out with an FPO. Its 17.1-crore share FPO will open on February 19 and will close on February 23. This will be followed by NMDC's FPO and Sutlej Jal Vidyut Nigam's IPO.

In the next fiscal, the Government is expected to divest its stake in PSUs such as Engineers India Ltd (IPO), Coal India (IPO), Power Grid (FPO) and SAIL (FPO).

Taken from

The Hindu Business Line

Source: Business Line
Courtesy moneycontrol.com

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