Rail Vikas Nigam Shares Tumble After Government Announces Stake Sale

Shares of Rail Vikas Nigam Ltd. fell after the government announced that it would sell up to 5.36% stake via an offer-for-sale.

The divestment includes a greenshoe option of a 1.96% stake. The sale will be open to non-retail and retail investors on Thursday and Friday respectively, the Department of Investment and Public Asset Management secretary had tweeted on Wednesday.

The OFS will be conducted at a floor price of Rs 119 per share. More than 7.08-crore equity shares of face value of Rs 10 each will be sold, representing 3.4% of the total paid-up equity share capital.

Shares of Rail Vikas Nigam were trading 4.32% lower at Rs 128.45 apiece as of 10.15 am compared to a 0.14% advance in the benchmark NSE Nifty 50. The stock declined as much as 6.29% intraday, the most since Feb. 2.

It has risen nearly 89.74% year-to-date. The relative strength index was at 56 and the total traded volume stood at 4.9 times its 30-day average.

Two analysts tracking the company maintain a 'Buy' rating, according to Bloomberg data.