Government proposes to sell upto 7% stake in HUDCO via OFS, raising ₹1100 Crore

The government is set to sell a 7% stake in Housing And Urban Development Corp. Ltd (Hudco) through an offer for sale (OFS) on October 18-19. The anticipated sale is expected to generate approximately ₹1,100 crore, according to a statement from a senior government official.

Tuhin Kanta Pandey, Secretary of the Department of Investment and Public Asset Management, confirmed the news via social media platform X (formerly known as Twitter).

The OFS will open for non-retail investors on the first day, followed by retail investors on the second day. The government fixed the floor price for the offer at ₹79 per share, it aims to sell about 140 million shares, totalling around ₹1,106 crore.

Hudco revealed that the OFS is crucial to meet the minimum public shareholding norms stipulated by the Securities and Exchange Board of India (Sebi). Currently holding an 81.8% stake in Hudco, the government plans to reduce its ownership to 74.8%—just below the maximum permissible limit of 75%.

Elara Securities (India), IDBI Capital Markets & Securities, and SBICAP Securities have been appointed as brokers for the sale. The funds raised through this stake sale will contribute to the government's disinvestment target of ₹51,000 crore for the fiscal year 2024.

As of October 17, the government had already garnered ₹6,950 crore from disinvestment, primarily from selling stakes in companies such as Coal India Ltd, Rail Vikas Nigam Ltd, and SJVN Ltd. The Hudco stake sale aligns with the government's ongoing divestment strategy, aiming to optimize its holdings in various listed companies.

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