Bharat Dynamics: Government to Sell 15% Share via Offer of Sale

The Indian Government plans to sell shares of Bharat Dynamics through Offer of Sale. According to the sources, the Government will lay off 15% stake of Bharat Dynamics. The company manufactures ammunition and missile system since its inception in 1970.  The sources close to the Exchange filing informs that the Government will lay off approximately 1.83 crore stakes valuing 10%.

The sale price stands at Rs. 330 per share, and this is 14% low than the current market value.  However, there is a chance of oversubscription of 91.67 lakh shares that equal to 5% share. In case of oversubscription, the Government’s shareholding in Bharat Dynamics will come down to 72.5% from the current holding of 87.75%

The Offer Of Sale in Bharat Dynamics will remain open for non-retail and retail investors on Sept.8 and Sept.9, respectively. The retail investors will get Rs, 20 off on equity shares on the bid price entered by them. The Modi Government is likely to raise approximately Rs. 604.8 crore if the Offer of Sale in Bharat Dynamics gets entirely subscribed.

Whereas, an oversubscription of the same will let the Modi Government raise approximately Rs 907.2 crore. Earlier to this, the Union Government raise Rs. Rs 5,020.8 crore by selling 15% shares of Hindustan Aeronautics Ltd.

Bharat Dynamics develops guided missile systems along with surface-to-air missiles, anti-tank guided missiles, underwater weapons, launchers, countermeasures, and test equipment.

Bharat Dynamics is a Hyderabad-based ammunition company with nearly 54% share in the missile market. The company has facilities in Bhanur, Telangana, and Visakhapatnam in Andhra Pradesh.

The Offer Of Sale will take place via a dedicated window of BSE (Bombay Stock Exchange) and NSE (National Stock Exchange).  The shares of Bharat Dynamics came down to by 13% after the announcement of shares lay off by the Union Government.