Retail investors can invest up to Rs 2 lakh in MOIL IPO

The government today said that state-owned MOIL, which will hit the capital markets on November 26, would become the first PSU to come with a public offer where retail investors can invest up to Rs 2 lakh.

"This would be the first issue by a PSU (MOIL issue) where retail investors will be able to invest up to Rs 2 lakh," Disinvestment Secretary Sumit Bose told reporters here.

As per the new norms announced by market regulator the Sebi in October, investment limit for retail investors in initial share sale offer has been doubled to Rs 2 lakh as against Rs one lakh earlier.

MOIL, formerly known as Manganese Ore (India) Ltd, will hit the capital market on November 26 with a public issue of 3.36 crore equity shares and the IPO would close on December 1.

The government has fixed the price band at Rs 340-375 a share for the issue, which is expected to raise up to Rs 1,238 crore through the share sale programme.

The issue has been priced, taking into account number of factors including strength of the company, its management and assessment of its peer firms, Bose said.

On roping in anchor investors, he said, "We are not going for anchor investors in this issue. There is adequate demand by FIIs."

The IPO will have the Centre divest 10 per cent of its stake in the country's largest manganese manufacturer, while Madhya Pradesh and Maharashtra governments will shed five per cent each.

The issue would raise a total of Rs 1,238 crore at the upper end of the price band, including 5 per cent discount to retail investors and MOIL employees.

Steel Secretary Pradeep Kumar Misra said that the largest domestic producer of manganese ore was likely to be listed on domestic bourses by December 13.

"Tentative date for listing will be 10-12 days after the issue closes," Misra said, adding, "Market for MOIL is fairly assured."

"Market should take this issue enthusiastically. We also welcome retail investors. The basic objective of the government of India in disinvesting in PSUs is larger holding of public," he said.

MOIL has a total employee strength of 6,734 and its about 3,000 employees have already opened demat accounts.

For the half year ended September 30, the company's turnover was Rs 635 crore, as compared to Rs 430 crore in the first half of previous fiscal. Profit after tax for the first half of this year stood at Rs 330 crore against Rs 201 crore in the year-ago period.