Oil India IPO receives good institutional response

The initial public offer of Oil India (OIL), a government-owned exploration major, that closed on Thursday was oversubscribed 31 times with most of the bids coming in from institutional investors.

The 2.65-crore share IPO was priced in a band of Rs 950-1,050 per share. At the upper end, the company hopes to mop up Rs 2,250 crore.

The qualified institutional buyer portion was subscribed 53.8 times, while the high net worth individual (HNI) segment got a subscription of 10 times. On the other hand, the retail portion received a subdued response, with the subscription estimated at just 1.14 times.

The exploration major had postponed its IPO last year in the wake of adverse market conditions. It is the second public sector company to launch a public offer in recent times, NHPC being the first.

OIL, has charted out plans for investment around Rs 2,335 crore during the fiscal. The company is hoping to raise around Rs 2,500 crore through the IPO to bridge the funding need for its various exploration and production activities. From this sum, it will pool around Rs 1,430 crore in exploration and production and Rs 495 crore towards revamping its ageing fields.