New Delhi: The government today fixed the issue price for Coal India Ltd’s mega IPO at Rs245 per share, at the upper end of the initial offer price range, PTI reports. The government would fetch over Rs15,000 crore with the issue of 63.16 crore shares of Coal India at a price of Rs245 a share, coal minister Sriprakash Jaiswal said after a meeting of the Empowered Group of Ministers (EGoM), headed by finance minister Pranab Mukherjee, this evening.
“It was a grand success. It happened for the first time in the history of India,” Mr Jaiswal said. Besides Mr Jaiswal and Mr Mukherjee, home minister P Chidambaram and Planning Commission deputy chairman Montek Singh Ahluwalia were the also part of the EGoM. The Board of Coal India also met subsequently to approve the issue price. There will be a discount of 5% for retail investors.
Coal India is expected to list on the stock exchanges on 4th November, the day before Diwali. The company’s initial public offer, which closed on 21st October, made history after it was oversubscribed 15.17 times mopping up Rs2,35,290 crore. The IPO, which had a price band of Rs225-245 a share, garnered total demand for over 960.36 crore shares, as against 63.16 crore shares on offer.
The public offer is part of the disinvestment programme of the government, which aimed to raise about Rs15,400 crore through the sale of a 10% stake in the company. The government holds 100% equity in Coal India. This share sale is expected to be followed by similar IPOs by Powergrid, Hindustan Copper, Manganese Ore India and SAIL.
Mumbai: In the face of flooding of IPOs, the Securities and Exchange Board of India (SEBI) today doubled the limit for retail investors to Rs2 lakh and tightened the norms for firms to guard against unnatural hyping of the issues. The market regulator also paved the way for public offerings by insurance companies by issuing disclosure and accounting norms, PTI reports.
Addressing journalists after a meeting of the SEBI Board this evening, SEBI chairman C B Bhave discussed issues ranging from abuse of issuance of preferential share norms in favour of promoters, to the role of the media and agencies generating coverage for public issues where risk factors are virtually hidden. He, however, said that some more time would be needed to revamp the norms for acquisition of listed firms.
“The Board decided that the maximum application size for retail individual investors may be increased to Rs 2 lakh across all issues,” Mr Bhave said.
The market regulator also asked the companies coming out with IPOs to come clean on their media coverage in the run-up to the public issue by making adequate disclosures with the regulator and investors about all the news reports. The provision is meant to ensure that the information appearing in the media is consistent with the disclosures made in the public offer document.
“The Board (has) decided that the merchant bankers may submit a compliance certificate as to whether the contents of the news reports that appear after filing of draft offer document are supported by disclosures in the offer document or not,” Mr Bhave said. SEBI also asked the companies to announce a fixed date for payment of dividend and issue of bonus shares for the benefit of investors.
While clearing the much-awaited norms for insurance IPOs, the market regulator also paved the way for rights shares issuances for companies listed in India through Indian Depository Receipts (IDRs). “In order to ensure uniform treatment for all classes of investors in rights issues, the Board decided that only one payment option may be given by the issuer to all the investors, that is either (i) part payment on application with balance money to be paid in calls or (ii) full payment on application. The Board also decided that where the issuer opts for part payment, it shall be incumbent on them to obtain approvals, if any, as may be necessary for the purpose,” he said.
New Delhi: State Bank of India (SBI) has said it will soon launch a business that facilitates payment through debit or credit cards at retail outlets and that it is deciding on the shareholding pattern with foreign partners, PTI reports. "We would be finalising the equity ratio with the joint venture partner soon, post which the merchant-acquiring business would become operational," OP Bhatt, chairman of SBI, said today.
The merchant-acquiring business is a facilitation of payment through debit or credit cards at retail outlets. SBI plans to place about 1.50 lakh point-of-sale (PoS) terminals for debit and credit card payments across the country.
The Reserve Bank of India has already approved SBI's proposal to set up a wholly-owned subsidiary for the merchant-acquiring business in the name of SBI Payment Services. US-based Elavon Incorporation and Visa International are joint venture partners for SBI's merchant-acquiring business. The business penetration of the new operation is envisaged on a pan-India scale, with metro, urban, semi-urban and rural centres.
Last year, the bank had floated 'Request for Proposal' for selection of a joint venture partner for the merchant-acquiring business. The business would include acquiring bank identification numbers from the schemes, as well as managing services for PoS terminals. The managed services would include deployment of PoS terminals at customer locations, their replacement, merchant training and maintenance.
The State Bank group has over 21,000 ATMs across the country and has issued over 60 million debit cards.