NLC India OFS opens today: Check floor price, key details and why govt is ramping up divestments

The government's fund-raising drive through an offer for sale (OFS) is in full swing. After divesting its stakes in public sector entities such as Coal India (CIL), NHPC, and Central Bank of India, the government has now announced its plan to offload its stake in NLC India Limited.

On Monday, June 8, post-market hours, NLC India Limited informed stock exchanges that the government will sell up to a 3% stake in the PSU through an offer for sale (OFS) at a floor price of ₹303 per share.

Separately, Department of Investment and Public Asset Management (DIPAM) Secretary Arunish Chawla also announced on X that the government will divest up to a 3% stake.

The OFS opens for non-retail investors on Tuesday.

"The Government of India announces OFS in NLC India Limited (formerly Neyveli Lignite Corporation) with a base offer of 2% of its equity and an additional 1% green shoe option in case of oversubscription," Department of Investment and Public Asset Management (DIPAM) secretary Arunish Chawla said on X.

NLC India OFS: Key details

The floor price fixed at ₹303 per share of NLC India reflects a 9.73% discount over the closing price of ₹335.65 apiece on the BSE on Monday.

On the NSE, NLC India shares ended at ₹335.75 apiece, down 0.25%.

The offer for sale (OFS) opens for retail investors on June 10.

With strong operational and financial performance, consistent returns, and attractive dividends, NLC continues to offer a compelling long-term investment opportunity, Chawla said.

So far in the current fiscal, the government has mopped up ₹12,166 crore by selling minority stakes in PSUs. These disinvestments include ₹5,542 crore from Coal India, ₹4,357 crore from NHPC, and ₹2,266 crore from the Central Bank of India.

What is driving the government’s aggressive OFS push in the current market?

Analysts opine that the aggressive OFS activity reflects a mix of fiscal need and structured disinvestment planning, rather than any sudden shift in ownership strategy. The government is essentially using strong PSU market interest to systematically monetise small stakes across multiple companies, they say.

It must be noted that the FY27 Budget has estimated a mop-up of ₹80,000 crore through disinvestment and asset monetisation, more than double the ₹33,837 crore as per the revised estimates for FY26.

Expert Take

Harshal Dasani, the business head of INVasset PMS, said that the government’s OFS push is a liquidity window decision, not distress selling.

The expert added that the government is using a market that still has institutional appetite for cash-generating PSUs to raise non-tax receipts without giving up control. Coal India, Central Bank, NHPC, and now NLC India all sit in pockets where valuations have rerated, balance sheets are visible, and dividend comfort gives buyers a cushion.

"For the market, the signal is clear. The PSU trade has moved from scarcity premium to valuation discipline. When the government supplies stock through OFS, it improves float and gives large investors an entry at a discount, but it also caps runaway momentum. Every rally in select PSU names will now be tested against the possibility of fresh supply," Dasani added.

The good part is that demand is still showing up. The caution is that supply coming too quickly can tire the trade.

“Investors may still participate where earnings visibility, cash flows, and dividend yield justify the price, but the easy phase of PSU rerating is behind us. From here, fundamentals will matter more than ownership excitement,” Dasani said further.

About NLC India

NLC India Limited has been a leading player in India’s energy sector for more than six decades. It is one of the largest entities in lignite production. The public sector company primarily operates in two segments: lignite mining and power generation. It is a major contributor to the thermal and renewable energy requirements of the country.

NLC India Limited was incorporated in November 1956 as Neyveli Lignite Corporation Limited. It was established by the Government of India as a private limited company. In 1986, NLC India Limited was converted into a public limited company.