The government is set to divest up to a 5% stake in General Insurance Corporation of India (GIC) through an offer for sale (OFS) at a floor price of Rs 352 per share. The issue will open for institutional investors on Tuesday, June 16, with retail investors allowed to bid on Wednesday.
OFS Details and Expected Proceeds
At the floor price of Rs 352 apiece, the sale of over 8.77 crore shares is expected to generate approximately Rs 3,000 crore for the exchequer. The Department of Investment and Public Asset Management (DIPAM) Secretary Arunish Chawla announced on X that the government will divest 2% equity in GIC, with an additional 3% stake available under the green shoe option.
Market Reaction and Discount
Shares of GIC closed 2.55% higher at Rs 388.35 on the BSE on Monday. The OFS floor price represents a discount of 9.36% to the closing market price, making it an attractive opportunity for investors.
Government's Disinvestment Progress
In the current financial year, the government has already raised Rs 13,389 crore through stake sales in public sector companies. This includes Rs 5,542 crore from Coal India, Rs 4,357 crore from NHPC, Rs 2,266 crore from Central Bank of India, and Rs 1,223 crore from NLC India. The Centre aims to surpass its budgeted target of Rs 80,000 crore from PSU disinvestment and asset monetisation during the current fiscal year.
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