The follow-on-public offer (FPO) for 10 per cent stake sale in Engineers India (EIL), which is expected to garner ₹500 crore to the exchequer, opened today.

The shares are being offered at a price band of ₹145-150 apiece and the issue would remain open till February 10. The FPO would remain open on bourses between 10 a.m. and 5 p.m.

EIL shares touched a high of ₹152.15 in early trade, up 2.14 per cent over the previous close. The scrip was trading at ₹152.60, up 2.45 per cent in the morning trade on the BSE.

The sale of 3.37 crore shares or 10 per cent stake could fetch around ₹500 crore at the upper end of the price band.

EIL said a discount of ₹6 a share will be offered to retail investors and employees. The Government plans to reserve 5 per cent of the offer for employees. The company’s order book as of September 30, 2013 stood at ₹3,232 crore.

The Government holds 80.4 per cent stake in the ‘miniratna’ public sector undertaking. In 2010, it had divested 10 per cent of its stake in EIL through an FPO.

In January last year, the Government had decided to go in for further disinvestment in EIL, which is a leading provider of design, engineering and project management and consultancy services for the hydrocarbon sector.

The Department of Disinvestment has already held overseas roadshows to attract foreign investors to the EIL stake sale.

The stake sale is being managed by ICICI Securities, IDFC and Kotak Mahindra Capital, Edelweiss Financial Services and IDBI Capital.

This is the second disinvestment through FPO in the current fiscal. In December, the Government had sold 4 per cent of its stake in PGCIL which fetched over ₹1,600 crore to the exchequer.

The Government has set a disinvestment target of ₹40,000 crore in the current financial year. So far, it has raised about ₹3,000 crore through PSU stake sale.

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