Bharat Dynamics fell 5.24% to Rs 313.80 after the company's offer for sale (OFS) received weak participation from the retail investors on Wednesday.
The OFS of Bharat Dynamics (BDL) was oversubscribed 1.4 times by non-retail investors on Tuesday and following the development, the government decided to exercise the "green shoe" option.Through the OFS, the Government of India proposed to sell 1,83,28,125 equity shares, constituting 10% paid-up share capital of the company, with an option to sell an additional 91,64,063 equity shares or 5% stake (oversubscription option). The floor price for the OFS was set at Rs 330 each.
The President of India, acting through and represented by the Department of Defence Production, Ministry of Defence, Government of India, is the promoter of BDL. As on 30 June 2020, the Government of India held 87.75% stake in the company.
The OFS opened on Tuesday (8 September) for non-retail investors, while both retail as well as non-retail investors were able to subscribe on Wednesday (9 September). Retail Investors will be allocated equity shares to the offer at a discount of Rs 20 to their respective bid price (including cut-off price) in accordance with the SEBI OFS circulars.
As on 15:30 IST on Tuesday, the OFS received subscription for 2,18,38,589 shares or 140.18% against the base non-retail offer size of 1,55,78,906 shares.
As on 15:30 IST on Wednesday (T+1 day), the OFS received total bids for 16,66,493 shares or 60.62% of the total retail offer size of 27,49,219 shares. The non-retail portion remained unsubscribed on Wednesday.
On a standalone basis, Bharat Dynamics reported net loss of Rs 78.04 crore in Q1 June 2020 as compared to a net profit of Rs 65.55 crore in Q1 June 2019. Net sales slumped 97.7% to Rs 9.77 crore in Q1 June 2020 over Q1 June 2019.
Bharat Dynamics manufactures defense equipment. The company offers ammunitions, counter measures dispensing, infra red interference indicators, and missile systems. It serves military and aerospace industries in India.
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