GE Vernova shares plunge 5% as promoter launches stake sale via OFS

Shares of GE Vernova T&D India were locked in a 5% lower circuit at ₹1,820.85 per share on the BSE following the announcement of a promoter stake sale via an Offer for Sale (OFS). This decline came even as the BSE Sensex climbed 0.11% to 80,199.66. The company's market capitalisation now stands at ₹46,622.23 crore.

Details of the promoter’s stake sale

The company’s promoter, Grid Equipments, plans to sell up to 8.38% of its equity stake through the OFS mechanism. As per the filing, the base offer size represents 5.47% of the paid-up equity share capital, amounting to 14,000,000 equity shares with a face value of ₹2 each.

The OFS opens for non-retail investors on 26 November 2024 and for retail investors on 27 November 2024. Additionally, in case of oversubscription, a green shoe option will allow the promoter to sell an additional 2.91% stake, equivalent to 7,451,168 equity shares.

OFS floor price set at a discount

The floor price for the OFS has been fixed at ₹1,550 per share, representing a 19% discount from the previous closing price.

Promoter holding and company background

As of the September quarter, Grid Equipments held a 59.08% stake in GE Vernova T&D India. The company, part of the global GE Vernova brand under General Electric (GE), focuses on sustainable energy solutions, particularly in the Transmission and Distribution (T&D) space. It plays a vital role in modernising and decarbonising India’s power infrastructure, a key driver of its share market investment appeal.

Recent stock performance

GE Vernova shares have been a standout performer, delivering a 352.2% return over the past year compared to the Sensex's 21% gain. Despite this robust performance, the current selling pressure and discounted OFS floor price have dampened investor sentiment in the short term.

Share market investment outlook

For investors exploring share market investment, GE Vernova T&D India remains an intriguing prospect due to its critical role in India's energy transition. However, the ongoing promoter stake sale and the potential short-term volatility it introduces warrant careful consideration.

While the current OFS offers an opportunity to enter at a discounted price, prospective investors should assess the long-term growth prospects of the company's sustainable energy initiatives.