HUDCO down 9%

Housing and Urban Development Corporation (HUDCO), a PSU undertaking engaged in housing finance and infrastructure project finance is among the three losers since the opening bell today morning.

The stock opened almost 8% lower at Rs.89.92 and went down further to Rs.81.80, a decline of 9%. Its 52-week high is at Rs.95.89 and low is at Rs.34.80.

The stock fell because the Govt yesterday announced that it will be selling up to 7%  - 3.5% equity through an Offer for Sale (OFS) with a greenshoe option to sell another 3.5% stake. The floor price of OFS was set at Rs 79 per share, at a discount of 12.17% from the previous close.

The bid has opened today for Non-Retail Investors and that for retail investors will open tomorrow.

The Govt, based on the base offer and oversubscription option, plans on selling up to 14.01 crore shares.

The floor price of an OFS is generally set at a marginal discount to the prevailing market price to encourage investors to bid for the issue. 

This comes on the back of the poor response to MMTC’s OFS – though it has received the approval for the OFS, the news is that the transaction advisors have failed to go ahead with OFS and there is now talk of its closure as there is no investor interest. A final decision on this is awaited.