NEW DELHI: The two-day Offer for Sale (OFS) by Cochin Shipyard Limited (CSL) to divest 5 per cent of its stake saw robust interest from retail investors, bolstered by the company’s strong financials and significant order book, according to an official statement from the Department of Investment and Public Asset Management (DIPAM).
The government divested 2.5 per cent of its equity stake in CSL, with an additional 2.5 per cent offered as a green shoe option.
“The second day of Cochin Shipyard Ltd OFS closed with good interest from retail investors. We thank all investors for their participation,” said the Secretary of DIPAM in a social media post on ‘X’.
2.26 times oversubscribed
The OFS opened on October 16 for non-retail investors and was oversubscribed 2.16 times the base size, underscoring strong demand from institutional buyers.
In response to the enthusiastic reception, the government exercised the green shoe option, allowing it to divest an additional 2.5 per cent stake.
On October 17, the OFS opened for retail investors and CSL employees, drawing significant interest from retail participants, reflecting their confidence in the company’s growth trajectory.
Share rose by Rs6.10 today
The company’s stock surged by Rs6.10 to close at Rs1,566.05 on October 18, reflecting sustained investor enthusiasm.
“Trading at a price-to-earnings (PE) ratio of 47.98, CSL is favoured by investors due to its strong financial position and a robust order book that promises future growth,” said a stock analyst while talking to businessbenchmark.news
Over the past year, the stock has seen a remarkable rise of 131.71 per cent, climbing from Rs675.88 to Rs1,566.05. This meteoric growth has solidified CSL as a key player in India’s defence and commercial shipbuilding sectors, making its stock a favorite among both institutional and retail investors.
Divestment, part of Govt policy
The Offer for Sale is part of the government’s ongoing divestment program aimed at reducing its stake in public sector enterprises while giving investors a chance to participate in the company’s continued success.
The strong demand from both non-retail and retail investors highlights CSL’s positive outlook, driven by its substantial order book and its strategic importance in shipbuilding, positioning it for long-term growth.
Investors’ confidence in CSL’s solid fundamentals and growth potential has cemented its place as a top pick in the market, evidenced by its robust share price performance and high multiples of earnings.
