The Hindu : Business : CIL issue subscribed 1.7 times on second day

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Wednesday, Oct 20, 2010
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CIL issue subscribed 1.7 times on second day

Special Correspondent

KOLKATA: With two more days to go, the initial public offer (IPO) of shares of the public sector Coal India Ltd (CIL) was oversubscribed on the second day with the issue receiving 108.02 crore bids against the offering of 63.16 crore shares marking a subscription of 1.71 times.

While the portion reserved for qualified institutional bodies, including foreign institutional investors and domestic financial institutions as well as mutual funds, drew a 3.39 times response, that of non-institutional buyers got subscribed by 0.54 times, followed by retail. Employee subscription was 0.01 per cent, according to the National and Bombay stock exchanges.

The issue, which has a price band of Rs.225-245, opened on October 18 with one-third of the shares getting lapped up on the first day.Based on the demand generated for the scrip at the major stock exchanges, the empowered group of ministers will take a call on finalising a price on October 23.

Kishore P. Ostwal, Managing Director of CNI Research told The Hindu that on listing, the scrip was now expected to move in a price range of Rs.280-290. “It will give a good return of say 300 per cent over a five year timeframe. This should be a long-term investment,” he said.

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