Mumbai: Public sector unit Bharat Dynamics Ltd on Monday filed the red herring prospectus for its initial public offering (IPO), which the company plans to launch in the coming weeks, said two people aware of the development.

The share sale is a pure offer for sale that will see the Indian government sell a total of 21.99 million shares, representing a stake dilution of about 12%.

The IPO is expected to be launched in mid-March and the government will garner close to Rs600 crore, said one of the two people cited above, requesting anonymity as he is not authorized to speak with the media.

An email sent to Bharat Dynamics did not elicit any response.

Incorporated in 1970, Bharat Dynamics is engaged in the manufacture of surface-to-air missiles (SAMs), anti-tank guided missiles (ATGMs), underwater weapons, launchers, countermeasures and test equipment. The company, which is the sole manufacturer for SAMs, torpedoes and ATGMs in India, is also the sole supplier of SAMs and ATGMs to the Indian armed forces.

The Hyderabad-headquartered company has three manufacturing facilities located in Hyderabad, Bhanur and Visakhapatnam.

It is also setting up two more manufacturing facilities at Ibrahimpatnam, near Hyderabad and Amravati in Maharashtra which will be used to manufacture SAMs and very short range air defence missiles, respectively.

As on 31 October, the company had an order book of Rs11,164 crore.

According to a draft prospectus filed in January, in fiscal 2017, Bharat Dynamics reported total revenue of Rs5,195 crore, up 13% from the previous year. The company’s profit declined by 12.8% to Rs490.32 crore in 2016-17 from a year earlier.

The company has appointed SBI Capital Markets Ltd, IDBI Capital Markets & Securities Ltd and YES Securities (India) Ltd to manage the share sale.

Bharat Dynamics’ initial share sale is part of the Union government’s divestment plan under which the department of investment and public asset management (DIPAM) plans to sell government stakes in several central public sector enterprises through various routes such as IPOs, offers for sale and strategic sales.

Another defence sector major—Hindustan Aeronautics Ltd—is also planning an IPO in March, Mint reported on 28 February.

HAL plans to raise around Rs4,000 crore through its IPO, Mint reported.

Hindustan Aeronautics makes fighter planes such as MiG-21 and MiG-27, Jaguar, Su-30 MkI, among other aircraft.