The Indian government's divestment bid hadn't received the expected response in the past few years, as it has kept bringing down its target and still missed the Rs 65,000 crore target by more than 50 per cent last year. It called off the privatisaiton of firms such as Bharat Petroleum after failing to get bids, and Air India was also rescued by Tata when no one else stepped up to buy it. But the Indian government's latest offer for sale of a stake in Coal India, has received an overwhelming response, with bids worth Rs 6,500 crore from institutional buyers.
Against its OFS for 8.31 crore shares of the state-owned coal producer, the government received bids for 28.76 units, which is 3.46 times the number of stocks on offer.
Positive signs at the beginning of the year
The shares were offered at a 7 per cent discount, as part of the first stake sale by the government in FY24.
With a target of raising Rs 51,000 crore via divestment this year, the government put up a 3 per cent stake in the PSU for sale.
Half of it was part of the OFS, and the other 1.5 per cent stake was set aside in case of oversubscription.
This was part of a 66 per cent stake which the Indian government holds in Coal India.