Tata Steel Public Issue to hit markets shortly
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Tata Steel, the major steel producer in the private sector, is planning a public issue to finance the expansion project of its Jamshedpur plant. An announcement in this regard is expected shortly.
Tata Steel For Public Issue
Tata Steel is planning to mobilize Rs 3500 – 5000cr through a follow on public offer (FPO) shortly. Though the company was looking to issue DVR shares, the plan has been dropped due to comparatively poor investor interest for that instrument in the markets.
Company is planning to expand the production capacity of its Jamshedpur plant from 6.8 million to 10 million. Total cost for the project is estimated at Rs. 13,000cr. Expansion program, which is already underway, is expected to be completed by September this year.
What is the difference between an IPO and FPO
IPO stands for Initial Public Offer. This is meant for companies that have not listed their shares on the stock exchanges.
FPO or Follow on Public Offer is meant for companies that are already listed on the stock exchanges. When such companies come out with a public issue it is called FPO.
What is DVR share
DVR stands for Differential Voting Rights. This means that voting rights of a DVR share holder will not be on a par with that of an equity share holder. For example, if a company comes out with DVR shares that have 10% voting rights compared to ordinary shares, an investor holding 10 DVR shares will have the same voting power as a share holder with 1 ordinary share.
In some cases a DVR share may have more voting rights than an ordinary share.
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Tata Steel Public Issue
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