Government Launches OFS to Sell Up to 5.04% Stake in Cochin Shipyard; Floor Price Fixed at ₹1,400 Per Share – Indian PSU

In line with its ongoing disinvestment programme, the Government of India has launched an Offer for Sale (OFS) to divest up to 5.04% equity stake in defence public sector undertaking Cochin Shipyard Limited (CSL). The stake sale comprises a base offer of 2.52% along with an additional 2.52% green shoe option, which can be exercised in the event of oversubscription.

The Department of Investment and Public Asset Management (DIPAM) has fixed the floor price at ₹1,400 per equity share, representing a discount of over 7% to the stock’s previous closing price. The OFS opened for non-retail investors on July 7, while retail investors and eligible employees will be able to participate on July 8.

If the entire green shoe option is exercised, the government is expected to raise nearly ₹1,856 crore through the transaction. Following the sale, the Centre will continue to retain a majority stake in the strategic defence shipbuilder. As of March 31, 2026, the Government of India held approximately 67.92% equity in Cochin Shipyard.

Part of Government’s Disinvestment Strategy

The OFS is part of the Centre’s broader strategy to mobilise resources through stake sales while maintaining management control in strategic public sector enterprises. The Union Budget for FY 2026-27 has set an ambitious target for raising funds through disinvestment and asset monetisation initiatives.

Market Reacts to Discounted Offer

Shares of Cochin Shipyard came under pressure after the announcement, declining as investors factored in the discounted OFS price and the increase in free float. Such price corrections are commonly witnessed during government stake sales and are generally viewed as a short-term market reaction rather than a reflection of the company’s operational performance.

Strategic Importance of Cochin Shipyard

Cochin Shipyard is one of India’s premier shipbuilding and ship repair companies and plays a pivotal role in the country’s maritime and defence ecosystem. The company is executing several projects for the Indian Navy and the Indian Coast Guard, while also expanding its presence in commercial shipbuilding and exports.

Backed by a healthy order book and the Government’s continued emphasis on indigenous defence manufacturing under the Atmanirbhar Bharat initiative, Cochin Shipyard remains one of the key beneficiaries of India’s growing defence capital expenditure.

Key Highlights

• Government to sell up to 5.04% stake in Cochin Shipyard through OFS.
• Base offer: 2.52%; Green shoe option: Additional 2.52%.
• Floor price: ₹1,400 per share.
• Non-retail bidding: July 7, 2026.
• Retail bidding: July 8, 2026.
• Government currently holds around 67.92% stake in the company.
• Total issue size may reach ₹1,856 crore if the green shoe option is fully subscribed.