Central Bank Of India Shares Drop Over 7%, Govt Launches ₹2,456 Crore OFS At ₹31 Floor Price
Central Bank of India shares fell more than 7 percent on Friday after the government launched an offer for sale (OFS) to sell up to 8 percent stake in the lender. The floor price was fixed at Rs 31 per share, lower than the previous closing price.
Central Bank of India shares fell more than 7 percent on Friday. |
Mumbai: Shares of Central Bank of India came under heavy selling pressure on Friday after the government started its offer for sale (OFS) in the state-owned lender.
The stock opened lower at Rs 32.30 on the National Stock Exchange (NSE) and slipped further during the session. According to the latest market update in the attached image, the stock was trading at Rs 31.53 at 2:27 pm IST, down Rs 2.39 or 7.05 percent for the day.
During intraday trade, the stock touched a low of Rs 31.42, very close to its 52-week low of Rs 31.30.
Govt Selling Up To 8 percent Stake Through OFS
The government has launched the OFS to sell 4 percent stake in the bank with an additional 4 percent greenshoe option.
The floor price for the issue has been fixed at Rs 31 per share, which is around 8.58 percent lower than Thursday’s closing price of Rs 33.92 on the NSE.
The OFS opened for institutional investors on Friday, while retail investors can bid on Monday.
If the greenshoe option is fully exercised, the government is expected to raise nearly Rs 2,456 crore through the stake sale.
Govt Stake To Reduce After Share Sale
At present, the government holds 89.27 percent stake in Central Bank of India.
After the OFS and possible greenshoe exercise, the government’s holding may decline to around 81.27 percent.
The stake sale is part of the government’s efforts to comply with SEBI’s minimum public shareholding rules, which require listed companies to maintain at least 25 percent public shareholding.
Analysts See Key Support Near Rs 31
Market experts said the stock has largely remained in a broad range between Rs 31 and Rs 40 over the last one year.
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Technical analysts believe Rs 31.30 remains an important support level for the stock. A break below this level could lead to further weakness and may push the stock towards Rs 28 levels.
The sharp fall in the stock price also reflected investor caution over the discounted OFS pricing and possible increase in supply of shares in the market.
Disclaimer: This article is for informational purposes only and not investment advice. Investors should consult certified financial advisors before investing.
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