Bpcl Sets Rs 265 Premium

The shares, which have a face value of Rs 10, will be offered at Rs 275. The price band approved by the board in the beginning of August was between Rs 275 and Rs 290. At that time, the BPCL board was in favour of charging a premium of Rs 275 per share. However, in view of the market condition, the lead managers and the BPCL board have decided on an offer price of Rs 275.

The final prospectus is expected to be ready within the next fortnight.

Sources said the entire issue of 15 million shares has already been fully underwritten by financial institutions, banks and mutual funds. However, the BPCL board has decided to offer 50 per cent of the total issue to the public. According to public issue guidelines, the company has to offer at least 25 per cent to the public.

 

The remaining 50 per cent is being offered to the financial institutions and banks, foreign institutional investors and employees. Twenty per cent of the issue has been earmarked for financial institutions and banks and another 20 per cent for FIIs. Ten per cent, or 1.5 million shares, has been reserved for BPCL employees.

The 40 per cent being offered to banks, FIs and FIIs will be firm allotments with the entire money paid upfront by institutions against guaranteed allotment of shares by the company.

The BPCL scrip closed on the BSE at Rs 280 yesterday, trading at 10.7 times its 1996 earnings. The 52-week high and low are Rs 385 and Rs 220.

After the public issue, BPCL proposes to tap the GDR route. The government holding in the company post-issue will come down from 66 per cent to a little under 61 per cent.