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Wednesday, August 31, 2011

BHEL to split share before the FPO

The engineering and manufacturing heavyweight BHEL is likely to undergo a split of its equity shares as part of setting the stage for the Follow-on Public Offer (FPO) that is planned for the company. The Government of India, which currently holds 67.52 percent stake in the company is planning to divest 5 percent of its ownership in the company through the FPO

The shares of BHEL are currently quoted on the Bombay Stock Exchange at Rs.1,768 (As on August 30, 2011). The arrangement under the split would entail a split of every share of BHEL, having a Face Value of Rs.10/- into 5 new shares having a Face Value of Rs.2/- each. Consequently, after the split, investors would have 5 times the shares they held before the split. The split is aimed primarily to bring down the price by about 4/5th in order to make the shares affordable for the proposed FPO

Bharat Heavy Electricals Limited (BHEL) is the largest engineering and manufacturing enterprise in India in the energy-related/infrastructure sector, today. BHEL was established more than 40 years ago, ushering in the indigenous Heavy Electrical Equipment industry in India. The company has been earning profits continuously since 1971-72. BHEL caters to the core sectors of the Indian Economy, viz. Power, Transmission, Industry, Transportation, Renewable Energy, Oil & Gas and Defence. BHEL's operations are organised around three business sectors, namely Power, Industry - including Transmission, Transportation and Renewable Energy - and Overseas Business
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