Govt launches Cochin Shipyard OFS at ₹1,400 floor price, offers up to 5.04% stake
ADVERTISEMENT
The Centre on Monday launched an offer for sale (OFS) to divest up to 5.04% stake in state-owned Cochin Shipyard Ltd (CSL), fixing a floor price of ₹1,400 per share, a discount of more than 7% to the stock's closing price of ₹1,508.50.
According to the Department of Investment and Public Asset Management (DIPAM), the government will initially sell 2.52% of Cochin Shipyard's paid-up equity, with an option to offload an additional 2.52% under the green shoe option in case of oversubscription.
"Government announces Offer for Sale in Cochin Shipyard Ltd (CSL) with a base offer of 2.52% of its paid-up equity and an additional 2.52% as the green-shoe option in case of over subscription. Floor price has been fixed at Rs. 1400 per share," DIPAM Secretary Arunish Chawla said in a post on X.
Bidding schedule announced
The OFS will open for non-retail investors on July 7, while retail investors will be able to place bids on July 8.
The floor price represents a discount of around 7.2% to Cochin Shipyard's Monday closing price of ₹1,508.50 on the NSE, a pricing strategy typically adopted to attract institutional participation and ensure robust subscription.
Shares of Cochin Shipyard ended 1.02% lower at ₹1,508.50 on Monday ahead of the stake sale announcement.
Part of Centre's disinvestment drive
The stake sale forms part of the Centre's broader disinvestment programme aimed at unlocking value from public sector enterprises while maintaining management control.
An OFS allows promoters to sell shares through the stock exchange mechanism in a transparent manner. Institutional investors bid on the first day, followed by retail investors, who are typically offered a reservation in the issue.
Cochin Shipyard, one of India's leading shipbuilding and ship repair companies, has emerged as a key beneficiary of the government's push to strengthen domestic shipbuilding and defence manufacturing. The PSU has attracted significant investor interest in recent years, supported by a healthy order book, strong execution and expectations of sustained demand from both defence and commercial shipbuilding segments.
The latest OFS comes amid continued government efforts to monetise stakes in listed public sector enterprises while deepening retail participation in the capital markets. The final size of the stake sale will depend on investor demand, with the green shoe option enabling the government to sell an additional 2.52% stake if the issue receives strong subscription.