ONGC rush is relief in Govt’s IPO headache

The ONGC issue was oversubscribed in under 15 minutes. Retail investors are expected to pour in nearer to the issue close on March 13. ‘‘It’s a relief,’’ said Hemendra Kothari, chairman, DSP Merrill Lynch, lead manager to the issue. Kothari said he would reserve his celebration until after the issue was priced. Agreed Uday Kotak, vice-chairman of Kotak Mahindra, also a lead manager: ‘‘Obviously the mood here is good but we are going to work more hard in the next eight days… the IPO will make capital market history when it closes.’’

By afternoon, rumours about legendary fund manager Warren Buffet investing a whopping $1 billion were already doing the rounds but investment bankers said they could not confirm the news.

In Delhi, a jubiliant disinvestment minister Arun Shourie called a press conference to say that the government would raise at least Rs 13,100 crore from the six PSU IPOs. The government had fixed a price band of Rs 680 to Rs 750 for the issue with maximum bids coming at the below-Rs 700 levels. Retail investors will get a five per cent discount on the pricing. On Friday, however, the ONGC stock price closed at Rs 797.55 on the BSE and Rs 802 on the NSE thus providing investors a potential opportunity to make money.

Day trader Girish Shah, (63), sold his holding in ONGC to bid for cheaper shares. As he handed over Gail’s application form at Kotak Securities office in Mumbai’s busy Fort district, Shah picked up ONGC’s application form.

‘‘The scrip has shot up today and I am sure if I get allotment at a lower price I will be able to make some extra money,’’ he said. Shah has invested money in almost all the government-run companies that were recently up for grabs.

Investment advisor Balmukund Didwania, (32), has set aside Rs 40,000 for ONGC. Yet as he picked up an application form, Balmukund said it was time for small investors to get out of the markets.

‘‘I think the market are getting over-heated,’’ he said. ‘‘Once you get allotment just book your profits and sell.’’

The government’s offer for the sale of Gas Authority of India (GAIL) shares also received a good response. The offer which closed on Friday was oversubscribed 7.3 times. The process saw investors put in applications for 61.6 crore shares of the energy company.

Dredging Corporation of India offer which closes on March 8 has been oversubscribed six times so far.