Most share sales scrape through

Jet Air and Tata Tele issues fail to find enough buyers

A majority of the share sales by companies today to comply with the minimum public shareholding norms went through. Of the nine companies, which were selling shares worth Rs 900 crore, shares of Novartis India, Saint -Gobain and Adani Enterprises, were lapped up fully by investors. However, there were not enough buyers for shares of of prominent companies Essar Ports, Jet Airways and Tata Telelservices.

Tata Teleservices Maharashtra, which was making its second attempt to offload promoter stake through the offer-for-sale (OFS) route, fared the worst. Of the 35million shares, the OFS received bids for only 68,771 shares. In the case of Jet Airways and Essar Ports, the companies received bids for 90 per cent and 70 per cent of the shares, respectively.

“There is enough appetite in the market to absorb these share-sales. The success or failure of these share-sales depends on each individual company performance,” said Vikas Khemani, head – institutional equities, Edelweiss Securities.

Novartis India’s issue was subscribed more than seven times at an indicative price of Rs 495 a share as against a floor price of Rs 375 a share. The stock was also one of the highest volume generators on the BSE.  “MNCs like Novartis have a good financial record which makes them attractive to investors. Also, they intentionally keep the offer price low, so that the issue gets fully subscribed,” said Sunil Jain, head-equity research – retail at Nirmal Bang Securities.

Yesterday, six companies including Jaypee Infratech and Sun TV sold shares worth Rs 900 crore as firms rush to meet the public shareholding norms before the deadline of June 03. Promoters of private companies are required to bring down their stakes below 75 per cent before Monday.

On Friday, OFSs of ELCID Investments, Fomento Resorts and Hotels, Modern India and Sharda Motors Industries will hit the market. In a small relaxation to these companies, Sebi has also allowed companies to announce their share-sale plans just a day in advance to the launch of the issue. Earlier, companies were required to announce it on the last trading day before the launch of the issue. This is beneficial for companies looking to launch their issues on the last day of the deadline.