Govt Expands Hindustan Copper Stake Sale Amid Strong OFS Demand

(MENAFN- Live Mint) New Delhi: The government's discounted offer for sale (OFS) in Hindustan Copper Ltd received strong demand from institutional investors on the opening day, with bids reaching 3.41 times the shares on offer, prompting the Centre to exercise the entire greenshoe option to meet excess demand.

Taking to social media platform X on Tuesday, Department of Investment and Public Asset Management (Dipam) secretary Arunish Chawla said that the OFS had received an enthusiastic response from institutional investors and was oversubscribed 3.41 times on the first day.“The government will now sell the additional shares available under the green-shoe option,” he said.

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The government on Monday offered to sell a 3% stake in Hindustan Copper, or 2.90 crore shares, with an option to sell another 3%, taking the total potential stake sale to 6%. The floor price of ₹514 per share represented a more than 10% discount to the previous closing price, piling selling pressure on the stock. At the floor price, the government would realise about ₹2,982 crore by selling the full 6% stake, as it races to meet its fiscal year 2027 (FY27) disinvestment target of ₹80,000 crore.

The company's stock closed 7% lower at ₹533.20 on the BSE on Tuesday.

Retail investors and eligible employees can participate in the OFS on Wednesday. As much as 10% of the offer is reserved for retail investors, while up to 25,000 shares have been earmarked for eligible employees.

Earlier, Mint reported on 10 August that the Centre has already raised nearly three-fourths of its ₹80,000-crore asset-sale target for FY27, putting it on a stronger footing to meet a goal that it has repeatedly missed in recent years.

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Hindustan Copper is a central public sector enterprise under the administrative control of the ministry of mines. Its principal activities include exploration, mining and beneficiation of copper ore, as well as smelting and refining.

As per the Dipam portal, the government holds 63.96 crore shares, representing a 66.14% stake, in Hindustan Copper. At Monday's closing price of ₹573.55 per share, the value of the government's stake is about ₹36,685 crore, while the company's total market capitalization stands at around ₹55,464 crore. After the full 6% OFS, the government's holding will fall to 60.14%.

The stake sale is part of the government's broader minority-stake disinvestment programme. Dipam handles the sale of government equity in central public sector enterprises through routes including OFS, while minority stake sales are undertaken without transferring management control.

The latest transaction comes amid an active disinvestment programme in FY27. The government has so far fetched ₹52,716.02 crore in disinvestment receipts for 2026-27.

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Data from Dipam showed that the bulk of the proceeds came from the ₹31,515 crore realised through the sale of a 6.5% stake in Life Insurance Corp. of India Ltd in early August. The transaction was also aimed at reducing the Centre's holding in the insurer to 90% to meet the mandated minimum public shareholding of 10%.

Hindustan Copper reported a sharp year-on-year rise in its first-quarter FY27 performance. Its consolidated adjusted net profit rose 162.47% year-on-year to ₹352.37 crore, while net sales increased 81.36% to ₹936.5 crore.

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