Institutions lap up Coal India shares with bids worth Rs 6,500 cr

Institutional investors lapped up Coal India shares in this fiscal's maiden government stake-sale, with Rs 6,500 crore bids pouring in on the first day of the offer-for-sale.

The government had offered over 8.31 crore shares to institutional investors on Thursday under the offer-for-sale (OFS), but received bids for 28.76 crore shares or 3.46 times.

At the indicative price of Rs 226.12 a share, the bids of institutional buyers are worth Rs 6,500 crore.

"Offer for Sale in CIL received enthusiastic response from non-retail investors today.

"The issue was subscribed 3.46 times of the base size. The government has decided to exercise the green shoe option.

"Retail investors get to bid tomorrow," Department of Investment and Public Asset Management Secretary Tuhin Kanta Pandey tweeted.

The government currently holds 66.13 per cent in CIL.

The stake sale in Coal India will help the government inch towards the Rs 51,000-crore divestment target set for the current fiscal.

In the two-day OFS, the government is selling over 18.48 crore shares or 3 per cent in the PSU coal producer at a floor price of Rs 225 a share.

The sale includes a green-shoe option of 1.5 per cent in case of over subscription.

Shares of Coal India settled for the day at Rs 230.55 apiece on the BSE, down 4.42 per cent from its previous closing price.