The IRCTC stock plummeted as high as 5.56 percent to Rs 694.05 on the NSE and 5.49 percent to Rs 694.40 on the BSE.
After the government stated on Thursday that it will sell up to a 5 percent interest in Indian Railway Catering and Tourism Corporation (IRCTC) via an offer-for-sale (OFS) with a floor price of Rs 680 per share, IRCTC's stock dropped by more than 5 percent during late morning transactions.
During the late morning trading on the National Stock Exchange (NSE), the price of the scrip dropped as much as 5.56 percent, reaching a low of Rs 694.05 per share. On the Bombay Stock Exchange (BSE), the price dropped as much as 5.49 percent, reaching Rs 694.40.
The Indian Railways' ticketing and catering arm said Wednesday night that the government would sell up to a 5% share in the firm. As such, the government's divestment goal for the current fiscal year includes the selling of these shares. So far, the government has collected Rs 28,383 crore through the sale of stakes in central public sector businesses, putting it on track to meet its annual budget goal of Rs 65,000 crore.
It has been announced by IRCTC in a stock market filing that the government is aiming to sell a 2.5% interest in the state-owned corporation for Rs 680 per share, with an option to sell a further 2.5%.
If all four crore of IRCTC shares were sold at the floor price of Rs 680 each, the government coffers would receive around Rs 2,700 crore as a result of the transaction. Floor price is 7.47% below Wednesday's NSE closing price of Rs 734.90 IRCTC.
On Thursday, the OFS will begin accepting subscriptions from institutional investors, and on Friday, it will begin accepting subscriptions from regular investors.