FinMin upbeat on CIL IPO, expects huge response

Days ahead of the country's largest public offer by Coal India (CIL), the Finance Ministry today exuded confidence that the issue will do "very well" with support from retail as well as institutional investors.

"I expect Coal India IPO to do very well. There should be huge response from retail as well as institutional investors," Disinvestment Secretary Sumit Bose told PTI.

The over Rs 15,000-crore CIL IPO, which opens on October 18, has seen a broad endorsement from almost all the big as well as small investment banking firms. The world's largest coal producer is expected to commence trading on the domestic bourses by November 4.

The government has fixed the price band of CIL IPO at Rs 225-245 a share for the largest ever public offering in India. The Centre is divesting its 10 per cent stake in the Navratna company.

The success of the offering would also determine the success of the government's divestment plans for the current year and would contribute to keeping the fiscal deficit within the target for the year.

CIL is one of the largest companies in the world based on the coal reserves of 64,786 million tonnes as on April 2010.

Bose further said that follow-on public offer of Power Grid is next in line and is expected after Diwali in November.

Besides, the government will divest its stake in Manganese Ore India Limited, Hindustan Copper and Shipping Corporation of India in the current fiscal.

"The disinvestment in SAIL, ONGC and IOC is expected in the last quarter of the current fiscal," Bose added.

Aiming to raise Rs 40,000 crore through disinvestment this fiscal, the government has mopped up over Rs 1,000 crore by divesting stake in Satluj Jal Vidyut Nigam, and around Rs 1,000 crore through Engineers India FPO.