Oil India IPO: Public Listing of Oil India Limited
Oil India Limited is a Government run company. It produces 3.5 million tonnes of oil annually. They came out with a public offering last week, this is day 2. The Initial Public Offering which initially invited bids for 2.64 crore shares received bids for over 3.80 crores shares, 44% over the subscribed limit. Most of the bidders were Qualified Institutional Buyers (QIB’s). The data was accessed from the National Stock Exchange (NSE). The OIL IPO closes on September 11, 2009. The shares from this IPO will be listed on the Indian Stock Exchanges on September 29, 2009.
The QIB showed a lot more interest in the IPO than the retail investors. The Qualified Institutional Buyers bouthg 2.55 times the shares allocated for them against the 1.14 times lapped up by the retail investor.
This is the 2nd stake sale of Oil India Limited during this Congress-led Government. The Oil company which is a “Mini Ratna” hopes to raise close to Rs. 5000 crore through this IPO.
After the public offer and disinvestment, the government’s stake in the company will be down to 78.50 per cent from the present 98.13 per cent.
The government will sell 10 per cent of its current holding in OIL to the state-run refiners Indian Oil Corp, Hindustan Petroleum and Bharat Petroleum. IOC will get about five per cent, while HPCL and BPCL would take about 2.5 per cent stake each in the firm.
JM Financial Consultants, Morgan Stanley Company India Pvt Ltd, Citigroup Global Markets India Pvt Ltd and HSBC Securities and Capital Markets (India) Pvt Ltd are the lead book runner of the issue.
Rating agency Crisil has assigned a grade of four (out of five), indicating above average fundamentals, to the issue.
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