Govt Sells ₹1,800 Crore Cochin Shipyard Stake, Greenshoe Option Exercised
GS3Economy · S&T · Environment · Security· Capital markets & SEBI· Prelims·
Why in news
The Government of India is divesting a 5.04% stake in Cochin Shipyard through an Offer for Sale (OFS) to raise approximately ₹1,800 crore.
Background
The Centre initially offered a 2.52% stake which was oversubscribed by three times. This triggered the 'greenshoe option' to sell an additional stake. Retail investors are permitted to participate via trading platforms or brokers.
Facts for Prelims
- FactCochin Shipyard stake divested: up to 5.04% via Offer for Sale (OFS).
- FactEstimated revenue from disinvestment: ₹1,800 crore.
- S&TGreenshoe Option: A clause in an underwriting agreement allowing underwriters to purchase more shares than initially agreed if the offer is oversubscribed.
- BodyCochin Shipyard: A major public sector undertaking (PSU) under the Ministry of Ports, Shipping and Waterways.
For Mains
Q. Discuss how the government's disinvestment policy balances the need for fiscal consolidation with the objective of maintaining strategic assets in the maritime sector.
Dimensions to cover in your answer
- Market Liquidity: Impact of oversubscription and greenshoe options on retail investor participation and price discovery in PSU shares.
- Public Sector Reform: Transitioning from state-led ownership to private-sector participation in heavy engineering and shipbuilding.
Keywords: Disinvestment · Offer for Sale · Greenshoe Option · Fiscal Consolidation · Public Sector Undertakings
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This note is generated automatically from SatyaDheesh's news feed and mapped to the UPSC CSE syllabus. Check facts against the original report or PIB before using them in an answer.