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

The Centre 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 looks to meet its FY27 disinvestment target through market transactions.

“The OFS comprises a base offer of 2.52% of the company's paid-up equity share capital, along with an additional 2.52% green-shoe option that may be exercised in case of oversubscription. The floor price has been fixed at ₹1,400 per share,” Arunish Chawla, secretary at the department of investment and public asset management (DIPAM), wrote in a post on X on Monday.

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

The sale is expected to help the Centre mobilise more resources under its FY27 disinvestment programme. In the Union Budget for 2026-27, the government set a target of ₹80,000 crore from disinvestment and asset monetisation. So far, it has mobilised ₹24,928.09 crore, including ₹18,561.16 crore through disinvestment and ₹6,366.93 crore through asset monetisation, achieving about 31.2% of the full-year target.

As of Monday's closing price of ₹1,504.75, the Centre's 67.91% stake, comprising 178.67 million shares, was valued at ₹26,885.55 crore. The OFS floor price of ₹1,400 is at about 7% discount to the closing price. If the entire offer, including the green-shoe option, is subscribed, the government's stake in Cochin Shipyard Ltd will drop from 67.91% to 62.87%, and it will continue to retain majority ownership and management control of the company.

Disinvestment spree

So far in FY27, the government has raised ₹18,561.16 crore through disinvestment transactions. These include:

• An 8.08% stake stake in Central Bank of India, which fetched ₹2,266.13 crore;
• a 2% stake in Coal India Ltd for ₹5,542.36 crore; a 6.01% stake in NHPC Ltd for ₹4,357.36 crore;
• a 2.73% stake in NLC India Ltd for ₹1,223.57 crore;
• a 5% stake in General Insurance Corporation of India for ₹3,090.47 crore; and
• a 1.75% stake in Indian Railway Finance Corporation Ltd, which garnered ₹2,081.27 crore.

An OFS allows promoters to sell shares through the stock exchange platform in a transparent bidding process. Under the mechanism, institutional investors bid on the first day of the issue, followed by retail investors on the second day. The green-shoe option gives the seller the choice to offload additional shares if demand exceeds the base offer, thereby maximising proceeds from the transaction.

Cochin Shipyard, one of India's largest shipbuilding and ship-repair companies, has emerged as a key beneficiary of the government's push to strengthen domestic maritime infrastructure and defence manufacturing. The company has a diversified order book spanning defence vessels, commercial ships, ship repair and green shipping initiatives. It has also benefited from rising government spending on naval modernisation and port-led development.