Coal India stake sale today, floor price fixed at Rs 358

New Delhi: Government today fixed Rs 358 a share as the floor price for up to 10 percent stake sale in Coal India tomorrow, which may help the exchequer garner about Rs 22,600 crore in the biggest sale of shares. The floor price or minimum selling price is nearly 5 percent below today’s closing price of Rs 375.15 a share. [caption id=“attachment_2038989” align=“alignleft” width=“380”]  Stake sale in Coal India. Getty Images[/caption] The government is selling 31.58 crore shares, or 5 percent stake, in a public offer with an option to sell another 5 percent through offer for sale (OFS) or auction route. CIL has reserved 20 percent shares for retail investors who will also get 5 percent price discount. “The President of India, acting through and represented by the Ministry of Coal, Government of India is the promoter of Coal India Limited (the “Seller”) has now informed BSE that the floor price for the Sale in terms of the SEBI OFS Circular shall be Rs 358 per equity share of Coal India Limited (the ‘Floor Price’),” CIL said in a BSE filing. The CIL share sale would be the country’s biggest share sale ever and would help make up for more than half of the disinvestment target of Rs 43,425 crore for current fiscal. Coal India would be second company to hit the markets under the government’s disinvestment programme. The disinvestment will take place amid a section of trade unions threatening “symbolic demonstration” tomorrow to protest against the share sale and also warned of a possible strike at a later stage. With only Rs 1,715 crore being raised this fiscal by way of disinvestment, the government is looking at aggressively selling stakes in public sector firms to help meet its fiscal deficit target of 4.1 percent of GDP for the year ending 31 March. Government currently holds 89.65 percent stake in Coal India, which was listed through a record initial public offering (IPO) in October 2010, raising Rs 15,199 crore. At the IPO price of Rs 245 apiece, the issue was over subscribed 15 times. The other major stake sale lined up is in Oil and Natural Gas Corp (ONGC), but the slumping oil prices have dampened the company’s prospects. The ONGC disinvestment was to give the government at least Rs 15,000 crore. To overcome the shortfall, it has lined up a host of companies including NMDC, Indian Oil Corporation (IOC), Bharat Heavy Electricals (BHEL), National Aluminium (Nalco) and Dredging Corporation (DCIL). Five percent stake sale in PFC and REC are also on cards. PTI