OIL issue fetches Rs 3,141 cr for govt

Foreign investors are getting over 60% of the issue.

Government has raised Rs 3,141.39 crore through 10% stake sale in Oil India (OIL), with foreign investors getting over 60% of the issue.

While banks and insurance companies cornered 3.50% and 2.19% of OIL shares offered, 19.29% was alloted to mutual funds, the finance ministry said in a statement.

The remaining shares were alloted to clients and other institutions.

"The net proceeds to the government from the OIL OFS are Rs 3,141.39 crore," the statement said, adding that the minimum cut off price for share allotment was Rs 520 apiece.

The government on February 1 sold 10% stake in OIL and had fixed the base price or the minimum offer price at Rs 510 a share for the Offer For Sale (OFS).

The stake sale was a resounding success with the issue being lapped up by more than twice the number of investors originally targeted. It was fully subscribed even before the close of market hours. The issue got bids for 15.41 crore shares as against 6.01 crore on offer.

Unlike in the previous PSU stake sale, the Foreign Institutional Investors (FIIs) have shown keen interest in the OIL disinvestment and the highest bid came in at Rs 527 a share, a 3.33% more than the floor or auction start price of Rs 510.

With the FIIs getting 60.36% of the allotment, the foreign investors pumped in over Rs 1,800 crore into the OIL stake sale.

OIL scrip closed at Rs 530.70, down 0.73% on BSE.

Sources said LIC, SBI MF, HDFC MF and other financial institutions participated in the OIL share sale offer as they are "very positive on oil and gas sector".

Bids for over 7.50 crore shares were with 100% margin, meaning if the bidder decides to withdraw later they can do so. Bids that came in with zero% margin were over 7.91 crore shares, according to the NSE data.

While ONGC issue in March last year went through with help from state-owned LIC, retail investors had bid for OIL in numbers that were unseen during the previous three government auctions in ONGC, Hindustan Copper and NMDC.

With the OIL stake sale, the total realisation from disinvestment in the current fiscal has gone up to over Rs 10,000 crore. The government has budgeted Rs 30,000 crore to come from disinvestment in the current fiscal.

The government's stake has come down to 68.43% in OIL after disinvestment. OIL's paid-up capital as on March 2012 was Rs 601 crore. OIL got listed on stock exchanges in 2009.