Govt to Sell 3% Stake in BHEL via OFS at ₹254 Floor Price

A 3% share in Bharat Heavy Electricals Limited (BHEL) will be sold by the Indian government through an offer for sale (OFS), with a floor price of ₹254 per share. Through a special OFS window on the BSE and NSE, the stake sale will include more than 10.44 crore equity shares.

The government has also kept an oversubscription option open, allowing it to sell an additional 6.96 crore shares, or 2% equity, which would take the total potential divestment to 17.41 crore shares, equivalent to 5% of BHEL’s equity capital.

What Are the Key Details of the BHEL OFS?

The offer for sale will take place during normal market hours on Wednesday, through a separate trading window on both exchanges. At the floor price of ₹254, the government is set to raise approximately ₹2,653 crore from the base 3% stake sale, with proceeds rising to about ₹4,422 crore if the oversubscription option is exercised in full.

Retail investors will have at least 10% of the offer reserved for them. Any portion of the retail category that remains unsubscribed will be eligible for allocation to non-retail investors who choose to carry forward their unallotted bids to the next trading day.

The Government of India owns 63.17% of BHEL, or roughly 219 crore fully paid-up equity shares, according to the most recent ownership statistics the markets have available for the quarter that concluded in December 2025. The current OFS is part of the government’s ongoing effort to pare its holding while retaining management control.

BHEL shares closed at ₹276.1, up 0.53%, ahead of the OFS announcement, outperforming the broader market, with the benchmark index rising about 0.26% on the same day.

What Has Changed in BHEL’s Financial and Order Book Position?

The stake sale comes at a time when BHEL has reported a sharp turnaround in financial performance. The Maharatna public sector undertaking (PSU) declared a net profit of ₹382 crore for the December quarter, which was 206% higher year over year and more than three times the ₹125 crore reported for the same period last year.

Operations revenue increased 16% year over year to ₹8,473 crore, a result of improved project execution and a more robust order backlog. Total income for the quarter (including other income) stood at ₹8,700 crore, compared with ₹7,393 crore a year earlier. While total expenses increased to ₹8,188 crore, higher operating leverage and a sequential decline in finance costs supported margins.

Beyond quarterly numbers, BHEL has continued to secure large orders. Earlier on Tuesday, the company received a letter of acceptance for a project valued at around ₹2,800 crore from Bharat Coal Gasification and Chemicals Limited (BCGCL).

The order relates to the Syngas Purification Plant under the LSTK-2 package for a coal-to-2,000-tonnes-per-day ammonium nitrate project at Lakhanpur in Odisha’s Jharsuguda district.

Under the contract, BHEL will handle design, engineering, equipment supply, civil works, erection, commissioning, and operations and maintenance.

Also, BCGCL is a joint venture between Coal India Limited, which holds 51%, and BHEL, which owns the remaining 49%.

What Should Investors Watch as the OFS Plays Out?

The response of retail investors for the OFS and the degree of institutional participation will influence the direction of the market in the short term.

Additionally, BHEL had a successful quarter and received new orders at the time of the OFS, so the market may weigh the increased share supply against the better business performance.

Once the offer closes, attention is expected to shift back to execution on the ground, including the pace of project deliveries, new order wins and cost control, as the company continues its gradual turnaround after several quieter years.

Sources:

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