Falling Sensex responsible for low retail demand for NTPC FPO
The government attributed the muted response of retail investor to the NTPC's further offer to the declining trend in the stock market at the time of the issue.business Updated: Mar 16, 2010 20:02 IST
The government attributed the muted response of retail investor to the NTPC's further offer to the declining trend in the stock market at the time of the issue.
"The portion reserved for retail investors (in NTPC follow-on offer) was subscribed to the extent of 0.15 times," Minister of State for Finance S S Palanimanickam said in a written reply to the Rajya Sabha.
The government had realised Rs 8,480 crore from the NTPC FPO, he said.
"At a time when the (Bombay Stock Exchange benchmark) Sensex had fallen 700 points during the three days of the issue period, the overall issue was subscribed 1.23 times," he said.
The government had divested 5 per cent stake out of its 89.5 per cent holding in NTPC through a further public offer last month.
"In a follow-on public offering the response of retail investor is often low as the price is already discovered and the shares are available in the market," he added.
In a separate reply, Minister of State for Finance Namo Narain Meena said during the financial year 2009-10 as many as five public sector companies have entered the share market.
NHPC, Oil India, NTPC, REC and United Bank of India (UBI) have entered the share market during 2009-10 fiscal.
"SEBI has informed that all the five issues were over subscribed," he said.