HAL plunges 12% after its OFS opens for subscription

NEW DELHI: Shares of Hindustan Aeronautics slumped 12 per cent after the offer for sale (OFS) opened for subscription on Thursday. The government said it will sell up to 15 per cent stake in the defence firm via share sale in the next two days.

By the time of writing this report, the issue was subscribed 83.72 per cent.

The government is selling its stake at a floor price of Rs 1,001 per share through an offer for sale (OFS). The offer could fetch the exchequer around Rs 5,020 crore.

Through the OFS, the government will sell 3,34,38,750 equity shares, constituting 10 per cent paid-up share capital of the company, with an option to sell an additional 5 per cent stake or 1,67,19,375 equity shares (oversubscription option), HAL said in a regulatory filing.

The offer price is at 15 per cent discount to Wednesday’s closing price of Rs Rs 1,177.75, and the OFS will take place on August 27-28 on a separate window of the stock exchanges.

A total of 20 per cent of the offer size will be reserved for retail investors, and they will be allocated offer shares at a discount of 5 per cent to the cut-off price in accordance with the OFS guidelines.

The government owns 89.97 per cent stake in the company, which was listed in March 2018.

IDBI Capital Markets & Securities, SBICAP Securities and YES Securities (India) will be acting as the seller’s broker for the offer. Of these, IDBI Capital Markets will be acting as the settlement broker.

The stock was down 12.24 per cent at Rs 1,033.60 on BSE.