Govt to sell up to 5.04% stake in Cochin Shipyard through OFS; floor price fixed at ₹ 1,400 per share

The Center on Monday announced an offer for sale (OFS) of up to 5.04% in Cochin Shipyard Ltd, marking another minority stake sale by the government as it seeks to meet its FY27 disinvestment target through market transactions.

“The OFS comprises a base offer of 2.52% of the company’s paid-up share capital together with an additional 2.52% green shoe option exercisable in the event of oversubscription. The floor price has been set at ₹1,400 per share,” Arunish Chawla, secretary, Department of Investment and Public Asset Management (DIPAM), wrote in a post on X on Monday.

The offer will open to non-retail investors on July 7, while retail investors will be allowed to bid on July 8 in accordance with the standard OFS mechanism used for listed public sector companies, he added.

The sale is expected to help the Center mobilize more resources under its disinvestment program in FY27. In the Union Budget 2026-27, the government has set a target ₹80,000 crore from disinvestments and asset monetization. So far it has mobilized ₹24,928.09 crores, inclusive ₹18,561.16 crore through disinvestment and ₹EUR 6,366.93 million through asset monetization, achieving approximately 31.2% of the full-year target.

From Monday’s closing price of the day ₹1,504.75, the centre’s 67.91% stake, comprising 178.67 million shares, was valued at ₹26,885.55 million crowns. Minimum price of OFS ₹1,400 is about 7% off the closing price. If the entire offer is subscribed, including the green shoe option, the government’s stake in Cochin Shipyard Ltd will drop from 67.91% to 62.87% and will continue to retain majority ownership and control of the company.

Divestment

So far in fiscal year 27, the government has increased ₹18,561.16 crore through disinvestment transactions. These include:

OFS allows organizers to sell shares through the exchange platform in a transparent bidding process. Under this mechanism, institutional investors bid on the first day of the issue and retail investors bid on the second day. A green shoe option gives the seller the ability to convert additional shares if demand exceeds the underlying supply, thereby maximizing the proceeds of the transaction.

Cochin Shipyard, one of the largest in India shipbuilding and repair companies have emerged as major beneficiaries of the government’s push to boost domestic maritime infrastructure and defense production. The company has a diversified order book covering defense vessels, merchant ships, ship repair and green transport initiatives. It also benefited from increasing government spending on naval modernization and port-led development.