BHEL Shares Drop 6% as Rs 4,422 Crore OFS Opens for Subscription
BHEL shares experienced a significant decline following the government’s announcement of a 5% Offer for Sale (OFS) aimed at raising approximately Rs 4,422 crore. The latest developments in the BHEL stock are summarized below.
Key Details of the OFS
– Price Decline: BHEL shares fell roughly 6%, trading at Rs 259.3 on Wednesday morning.
– OFS Details: The government aims to sell a 5% stake in Bharat Heavy Electricals Limited (BHEL), starting with an initial 3% stake, followed by an additional 2% if the OFS is oversubscribed.
– Floor Price: Set at Rs 254 per share, this represents an 8% discount from Tuesday’s closing price of Rs 276.05.
Subscription Information
– Non-Retail Investors: The OFS opened for subscription on Wednesday for non-retail investors.
– Retail Investors: Retail investors will have the opportunity to place their bids on Thursday.
– Potential Revenue: If fully subscribed at the floor price, the sale of 17.41 crore shares could generate Rs 4,422 crore for the government.
Financial Backdrop
– Government Stake: The government currently holds a 63.17% stake in BHEL.
– Recent Disinvestments: In the current fiscal year, the government has raised Rs 8,768 crore through various PSU disinvestment initiatives.
Performance Highlights
BHEL recently reported a remarkable turnaround in its financial performance for Q3 FY2025, which is noteworthy amidst the current situation:
– Net Profit: The company posted a net profit of Rs 382 crore, more than tripling compared to Rs 125 crore from the same quarter last year, reflecting a striking 206% year-on-year increase.
– Revenue Growth: Revenue from operations increased by 16% year-on-year, reaching Rs 8,473 crore, up from Rs 7,277 crore in the previous year. This growth is attributed to enhanced project execution and a robust order pipeline.
– Total Income: BHEL’s total income, including other revenue, rose to Rs 8,700 crore from Rs 7,393 crore year-on-year.
Conclusion
As BHEL shares decline due to the Rs 4,422 crore OFS, investors and market watchers alike are keenly observing how this situation unfolds. The government’s strategic disinvestment is part of a broader initiative, and BHEL’s recent financial performance may provide context for the long-term outlook of the company amidst market fluctuations.