Govt. to divest 5% in NTPC

The government announced it will be divesting five per cent of its stake in NTPC through the offer-for-sale route on Tuesday.

The sale is expected to garner Rs.5,029 crore at a floor price of Rs.122 per share.

The stake sale is to be spread over two days, with institutional bidders getting to buy shares on Tuesday and retail investors on Wednesday.The retail investors have 20 per cent of the shares reserved for them.

“The floor price for the offer shall be Rs.122 per equity share,” NTPC said in a regulatory filing with the Bombay Stock Exchange. The company’s stock closed at Rs.126.85 on Monday.

Floor price
The five per cent stake in NTPC works out to 41.22 crore shares.

At the floor price of Rs.122 per share, this could fetch the government Rs.5,029 crore. The government has been struggling to meet the disinvestment target of Rs.69,500 crore for the financial year. With about 40 days left in the financial year, the government has managed to realise only Rs.13,330 crore through divestment which is less than 20 per cent of the budgeted target. Prior to this, the government divested its holdings in five other PSUs — Rural Electrification Corporation (Rs.1,608 crore), Power Finance Corporation (Rs.1,671 crore), Dredging Corporation of India Ltd (Rs.53.33 crore), Indian Oil Corporation (Rs.9,369 crore) and Engineers India (Rs.640 crore).