From GIC Re to Hindustan Aeronautics, free float for newly listed PSUs low

Free float are the shares that are not owned by promoters or are under lock-in and are readily available for trading in the market

In the past six months, five public sector undertakings (PSUs) have entered the market via initial 

public offerings (IPO). The Centre has diluted an average 15.4 per cent in these five companies in their maiden offerings. However, most of the shares on offer have been picked by state-owned institutional investors such as Life Insurance Corporation of India (LIC).

The ‘actual’ free float for these companies –excluding the shares bought by state-owned institutions – is an average 7.6 per cent.

For instance, in Hindustan Aeronautics (HAL) IPO, the central government offloaded 10 per cent stake. Nearly, 7 per cent stake in