Government raises Rs 770 via Bharat Dynamics OFS; share tumbles 19 per cent in 3 days

On Wednesday, the government declared that it has received subscriptions amounting to Rs 770 crore from retail and institutional investors under offer for sale (OFS) of Bharat Dynamics Limited.

Bharat Dynamics had declared about OFS on September 07, 2020, under which, the government had planned to sell 15 per cent stake in the company.

The floor price was set to be Rs 330 per share for institutional investors. For retail investors, there was an additional discount of Rs 20 per share.

As of March 31, 2020, Bharat Dynamics has an order book of ~Rs 7,400 crore. The company is supposed to get orders worth Rs 12,000 crore this year and along with this, many of the orders are being expedited amid the ongoing pandemic situation.

Under the government’s divestment programme, the government had offloaded 15 per cent stake in Hindustan Aeronautics Limited (HAL) to raise around Rs 5,000 crore.

Looking at the price trend, Bharat Dynamics has tumbled ~19 per cent in the last three days due to the government’s stake sell plan. On Thursday, the stock of Bharat Dynamics opened at Rs 315.25 and gained nearly three per cent and made an intraday high of Rs 322.65 on BSE.