Indian Government Initiates Divestment of 4.92% Stake in SJVN Through Offer for Sale

In a strategic maneuver, the Indian government has launched a significant divestment initiative, offering up a 4.92% stake in SJVN Limited. This effort also encompasses a Green Shoe option of 2.46%, in line with the government’s plan to reduce its equity holdings in the company. The divestment process will unfold through a two-day offer for sale, with priority given to non-retail investors initially, followed by opportunities for retail investors.

Key Details of the Offer:

  • Commencing tomorrow, the offer is open to non-retail investors.
  • Retail investors will have their turn to participate on Friday.
  • The government’s objective is to divest 4.92% of its equity stake in SJVN Limited.
  • The inclusion of a Green Shoe option, representing 2.46% of the equity, further enhances the offering.

DIPAM Secretary Tuhin Kanta Pandey shared this development, underscoring its significance in line with the government’s broader disinvestment objectives.

Floor Price and Expected Proceeds:

The floor price for this equity sale has been set at ₹69 per share. At this floor price, the sale of the 4.92% stake is estimated to yield in excess of ₹650 crore.

Market Response:

This announcement prompted a noteworthy surge in the value of SJVN Limited’s shares. On Wednesday, the company’s stock recorded an impressive 9.31% increase, reaching its 52-week high at ₹83.69. The trading session concluded with SJVN shares trading at ₹81.75 per share on the BSE, reflecting a substantial gain of 6.78%.

The government’s decision to reduce its equity stake in SJVN Limited has garnered significant attention from both investors and market observers. As the offer for sale progresses, it will be fascinating to monitor investor reactions and evaluate whether this divestment contributes to the government’s fiscal objectives. Stay tuned for further developments as this evolving narrative unfolds.

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