According to official sources on Wednesday, the government is considering selling a portion of its holdings in the state-owned Indian Railway Finance Corp (IRFC) through an offer for sale (OFS) during the current fiscal year.
Currently, the Indian government owns 86.36% of the Indian Railways’ financial division.
According to the PTI, discussions have begun to determine the amount of share dilution by an inter-ministerial group (IMG) composed of top executives from the Department of Investment and Public Asset Management (DIPAM) and the Railways Ministry.
In order for the central public sector firm to comply with Sebi’s MPS requirement, the government must reduce its 11.36% ownership stake in IRFC.
According to MPS regulations, during five years of listing, a listed business must have a minimum public float of 25%.
“We are assessing investor appetite before deciding on the quantum of dilution,” the official was quoted as saying by PTI.
The government would receive about Rs7,600 crore from the sale of 11.36% at the going rate on the market.
In January 2021, the government listed IRFC on stock exchanges. The corporation issued new shares as part of the share sale, and the government also diluted its holding by an extra 4.55%.
In the quarter that ended in June, IRFC reported a net profit of $1,557 billion, a 6% decrease from $1,660 billion in the equivalent quarter last fiscal year.
Shares of IRFC were up 0.14% over the previous close on BSE, trading at 50.97 per share.
IRFC stock reached a high of 52.70 in the opening minutes of trading on Wednesday. This month, the share price increased 38%.