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Tuesday, September 08, 2009

Oil India IPO subscribed 1.44 times

At the end of day two of the issue

The initial public offer (IPO) of state-run Oil India was subscribed 1.44 times at the end of day two, data on NSE website showed. The IPO received bids for 3.8 crore shares on Tuesday, 8 September 2009, compared to the issue size of 2.64 crore shares. The IPO opened for bidding on Monday, 7 September 2009, and closes on Thursday, 10 September 2009.

The IPO has received strong response from institutional investors. The qualified institutional buyers (QIB) category was subscribed more than 2 times on day one on Monday, with foreign institutional investors putting in bids for 2.43 crore shares.

At a price band of Rs 950-Rs 1050, the PE ratio works out to 10.2-11.3, based on earnings per share (EPS) of Rs 93 for the year ended March 2009 on post-issue equity of Rs 240.45 crore. The company is raising about Rs 2700 crore from the IPO

Along with the IPO, the government is simultaneously selling a part of its stake in Oil India to the three state-run refiners - Indian Oil Corporation, HPCL and BPCL. Post-IPO and disinvestment, the government's stake in the company will decrease from 98.13% to 78.5%.

Oil India is India's second biggest oil and gas production firm in terms of revenue after ONGC. Oil India's net profit rose 25.1% to Rs 2230.85 crore on 17.6% growth in sales to Rs 7200.70 crore in the year ended March 2009 over the year ended March 2008.

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