The government(govt) sold 58 million shares in Axis Bank, which is held through the Specified Undertaking of the Unit Trust of India (SUUTI) to raise around Rs 4,000 crore.
- The shares are sold through the offer for sale (OFS) route. The OFS was made open for non-retail investors on May 19, 2021, and for retail investors on May 20, 2021
- 35 million shares/ 1.21 percent stake in Axis Bank was sold by govt as a base offer and the remaining 22 million shares/0.74 percent stake was sold under a green-shoe option. The floor price for the stake sale has been fixed at Rs 680 apiece.
i.On December 31, 2018, SUUTI held a 9.56 per cent stake in Axis Bank, and it was reduced to 3.45 percent as of March 31, 2021.
ii.SUUTI sold 6.14 million shares of Axis Bank in December 2021 to raise Rs 374 crore for the govt, and in November 2021 it had sold 3.6 million shares for Rs 221.47 crore.
iii.In budget FY22, govt has set a target of Rs 1.75 lakh crore from disinvestments and strategic sales for FY22, and set to privatise 2 public sector banks and one general insurance company during FY22.
iv.Under which, it is planning IPO of Life Insurance Corporation and it has also announced the sale of Bharat Petroleum Corporation.
v.In May 2021 The Cabinet Committee on Economic Affairs approved the disinvestment and transfer of management control in the Industrial Development Bank of India (IDBI Bank).
Note – Green shoe option is an option that allows companies to intervene in the market to stabilise share prices during the 30-day stabilisation period immediately after listing. The issuer company uses it during the initial public offer(IPO) to ensure that the shares price on the stock exchanges does not fall below the issue price after the issue of shares.
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About Axis Mutual Fund:
Headquarters – Mumbai, Maharashtra
MD & CEO – Chandresh Kumar Nigam