RVNL's OFS oversubscribed on the first day, investors bid Rs 1900 crore

The issue got oversubscribed on the first day of the Offer for Sale (OFS) of state-owned Rail Vikas Nigam Limited (RVNL). Let us tell you that the government is selling a 5.36 percent stake in RVNL.
On the first day of the issue, institutional buyers placed bids worth Rs 1,900 crore for approximately 15.64 crore shares at an indicative price of Rs 121.17. In this two-day offer-for-sale (OFS), the government is selling 11.17 crore shares. The government has fixed a floor price of Rs 119 for this OFS.
Let us tell you that the government had said that it will sell about 7.08 crore equity shares ie 3.4 percent shares on the first day of the first issue and if the OFS is oversubscribed then the government will sell an additional 1.96 percent stake.
Shares of RVNL today closed at Rs 125.25, down 6.77 percent over its previous close on BSE. Let us tell you that the government currently holds a 78.20 percent stake in RVNL.
RVNL was incorporated in January 2003 as a 100 percent owned public sector unit of the Ministry of Railways, with the objective of mobilizing extra-budgetary resources and implementing projects related to capacity building and augmentation of rail infrastructure on a fast track.
So far in the current financial year, the government has raised Rs 4,235 crore, including Rs 4,185 crore from the sale of shares in Coal India. The full-year budget target from disinvestment is Rs 51,000 crore.
Offer for Sale (OFS) is a simplified method of sale in which promoters in public companies can sell their shares and dilute their stake in a transparent manner through the bidding platform for the Exchange.
The OFS segment was earlier permitted only for promoters/promoters' group entities of listed companies to act as 'sellers' to dilute/sell their stake to achieve a minimum public shareholding of 25 percent.
However, this segment has now been extended to non-promoters of eligible companies holding at least 10 percent share capital of the company.