The government offer for sale of 39,64,71,600 at a floor price was a great success. Data as per the BSE shows that there were bids for 73,24,79,476 shares. The indicative value of these bids cumulatively was Rs 149.18. The cut off price was Rs 148.50 against the floor price of Rs 147. This divestment has been a good success on a number of counts. Firstly the issue has been completed without using support from the state financial institutions. Secondly there was reasonable response from FII’s and also individual investors who felt that valuations are attractive at the offer price or floor price of Rs 147.

The success of this issue would prompt the government to come out with more divestment through the OFS route and the months of January-March should see half a dozen such issues. The proper pricing which is a key to the success of the issue would help the twin objects of achieving divestment and also ensuring that adequate price would ensure no selling pressure post divestment.