Bharat Heavy Electricals Limited (BHEL) shares fell sharply on Wednesday after the government announced a stake sale in the public sector undertaking through an offer for sale (OFS) at a discounted floor price. The stock opened nearly 5% lower at ₹262 compared with its previous close of ₹276, according to data from the National Stock Exchange (NSE).

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As of 10:56 AM, BHEL shares were trading at ₹261.35, down 5.34%, while the Nifty 50 index was up 0.1%, as per NSE data. Around 22.8 million shares had changed hands on the exchange by that time. The company’s market capitalisation stood at ₹90,742.6 crore.

Over the past 12 months, BHEL shares have gained 30.4%, outperforming the Nifty 50, which rose 12.5% during the same period, according to NSE data.

Details Of Government’s OFS

The decline in BHEL’s share price followed the announcement of the OFS by the Government of India, which is divesting up to a 5% stake in the company. The Ministry of Heavy Industries, the promoter of BHEL, is offering up to 104.4 million equity shares, representing 3% of the total paid-up equity share capital, through the OFS, according to an exchange filing by the company.

The offer includes a greenshoe option to sell an additional 69.6 million shares, equivalent to 2% of the paid-up equity capital. The equity shares have a face value of ₹2 each. In addition, up to 0.87 million shares, or 0.25% of the equity capital, have been reserved for eligible employees of the company, as stated in the filing.

The floor price for the OFS has been fixed at ₹254 per share, which represents a discount of around 8% to BHEL’s closing price on Tuesday. The OFS opened for non-retail investors on Wednesday, while retail investors can place bids on Thursday, according to the company’s exchange disclosure.
Order Update From Joint Venture

Separately, BHEL informed stock exchanges that Bharat Coal Gasification and Chemicals Limited, its joint venture with Coal India Limited, has received a Letter of Award for an ammonium nitrate project at Lakhanpur in Jharsuguda district, Odisha. The total value of the order is ₹2,800 crore, excluding customs duty, as per the exchange filing.

The project is scheduled to be executed within 42 months from the date of acceptance of the Letter of Award. The operations and maintenance phase of the project will extend for 60 months from the date of preliminary acceptance, according to the company’s disclosure.

The OFS and the project award were disclosed through regulatory filings with the stock exchanges on Wednesday.