The Centre has launched another major public sector stake sale, announcing plans to offload up to 5.04 percent of its holding in Cochin Shipyard Ltd through an Offer for Sale (OFS). The move comes at a time when defence and shipbuilding stocks remain in investor focus, with the government seeking to raise funds while improving public shareholding in state-run enterprises.
The government has fixed the OFS floor price at ₹1,400 a share, about 7 percent below Cochin Shipyard's previous closing price, making the issue attractive for institutional and retail investors.
According to the announcement by the Department of Investment and Public Asset Management (DIPAM), the OFS comprises:
A base offer of 2.52 percent equity
A green shoe option to sell another 2.52 percent if demand is strong
If fully subscribed, the government will reduce its stake by 5.04 percent. As of March 31, 2026, the Centre owned 67.92 percent of Cochin Shipyard.
The share sale will take place over two trading sessions.
July 7: Non-retail investors
July 8: Retail investors
Under the OFS mechanism, existing shareholders sell shares through the stock exchanges. Unlike a follow-on public offer, the company does not issue fresh equity, meaning the proceeds go entirely to the selling shareholder—in this case, the Government of India.
The sale forms part of the Centre's broader disinvestment and asset monetisation programme.
In the Union Budget 2026-27, the government set a target of raising ₹80,000 crore through divestment and monetisation of public assets. Stake sales in profitable public sector enterprises remain a key component of that strategy.
Cochin Shipyard has emerged as one of India's most strategically important defence shipbuilders.
The company builds aircraft carriers, warships, patrol vessels and commercial ships, while also operating one of the country's largest ship repair businesses. It has expanded its capabilities with a new international ship repair facility and a modern dry dock, enabling it to undertake larger naval and commercial projects. The company has also diversified into offshore vessels and export orders while strengthening partnerships in defence manufacturing.
The Kochi-headquartered PSU continues to execute several projects for the Indian Navy and Coast Guard, including anti-submarine warfare shallow water craft and other specialised defence vessels.
The 7 percent discount to the previous closing price is expected to attract institutional participation, although the share price could remain under pressure in the short term because of the additional supply entering the market.
Investors will also monitor the subscription levels closely, as strong demand could trigger the sale of the additional 2.52 percent under the green shoe option.
Despite the stake sale, the government will remain the majority shareholder in Cochin Shipyard, retaining effective management control over one of India's leading defence and commercial shipbuilding companies.