Oil India Ltd. or OIL's offer for sale received a good response on Friday, as the issue was subscribed more than two times. The company received bids for 14.16 crore shares, compared to an offer for sale of 6.01 crore shares, reports said.
It received bids for 6.80 crore shares with 100 percent margin and 7.35 crore shares with zero per cent margin.
Bids that came in with zero percent can revise the price only upwards, while they have no option to modify the price/quantity downwards or cancel the orders.
Recently, the market regulator Securities and Exchange Board of India (SEBI) modified the guidelines for offer for sale mechanism or auction route wherein orders made by institutional investors without paying upfront margin, cannot be modified or cancelled, except for making upward revision in the price or quantity. However, SEBI retained the 100 percent margin class, where bidders were allowed to modify or cancel their orders till last minute.
The indicative price (weighted average price) is Rs.517.80, while the stock closed on Friday at Rs.525.55.
The company fixed the floor price at Rs.510 a share. To make the OFS process more transparent, SEBI has said that indicative price of the offer should be disclosed throughout the trading session and the same should be calculated on the basis of all valid bids/orders.
"Settlement shall take place on trade for trade basis. For non-institutional orders/bids and for institutional orders with 100 per cent margin, settlement shall take place on T+1 day," the circular said.
The Indian government plans to raise Rs.3,065 crore through the offer.
by RTT Staff Writer
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