Mumbai: The auction for sale of the government's five per cent stake in Oil and Natural Gas Corporation Limited (ONGC) fell short of expectations as bids were received for only 29 crore shares out of the 42 crore on offer. The ONGC auction on Thursday fell short of target and will raise just Rs 8,000 crore against the target of Rs 12,000-13,000 crore, a shortfall of at least Rs 4,000 crore.
Bids for 19.92 crore ONGC shares were received on the National Stock Exchange (NSE) while at the Bombay Stock Exchange (BSE), the designated exchange for the proposed share sale, 9.3 crore shares were bid. The floor price for the one-day auction was fixed at Rs 290 for a Rs 5 share.
Most of the bids were in the price range of Rs 290-293 per share for the auction, under which the government had proposed to sell about 42.77 crore shares. The auction commenced at 9:15 am and closed at 3:30 pm on Thursday.
After an initial spike of about one per cent, ONGC shares had turned weak and even slipped below Rs 290 level by afternoon trade.
The shares would be allocated on 'price-priority' basis, meaning the bidders at highest price would be allotted shares.
The government on Tuesday decided to offload five per cent stake in ONGC through the auction route.
The government owns 74.14 per cent stake in ONGC and had proposed to sell 42.77 crore shares or 5 per cent equity.