Coal India Share Price Falls as OFS Announcement Puts Pressure
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Coal India Share Price Falls as OFS Announcement Puts Pressure
Early morning trading saw significant sell-off pressure on Cola India’s shares, which led to the downturn being extended for a fourth session in a row. The share price of Coal India fell today when it opened and hit an intraday low of Rs. 229.55 per unit on the NSE, following a 4.80% intraday drop on Thursday. The PSU stock has launched a chance for sale at a reduced rate of Rs. 225 per share, which has put pressure on Coal India shares since Tuesday’s trades.
Share price of Coal India drops and hits intraday low following OFS announcement
World News India shows the subscription period for the Coal India OFS began today and will end on June 2, 2023. Stock market experts claim that Coal India’s stock price is under pressure following Coal India OFS news because Coal India OFS is being offered at an enormous premium and stakeholders of the business are liquidating their holdings since they have the option to purchase scrip at a reduced rate via OFS. As a result, it is more strategic than any basic problem with the business. Positional investors were recommended to buy around the Rs. 220 per share level since the stock would experience a sharp rebound following the conclusion of the Coal India OFS.
The PSU business declared its OFS at Rs. 225 per share, which was much less than the scrip’s market price, which is why Coal India shares have been sliding for the last four sessions, according to Saurabh Jain, Vice President — Research at SMC Global Securities. Therefore, the trading becomes more strategic because the shareholders are dumping their stakes to subscribe to the PSU at a reduced price. After the close of Coal India’s OFS, the share price may experience a significant uptick.
Coal India shares have solid support at levels of Rs. 210 per share, according to Sumeet Bagadia, Executive Director at Choice Broking, who suggested bottom fishing in the company’s shares. This stock may be purchased between Rs. 220 and Rs. 230 while keeping a stop loss at Rs. 210 per share. Soon, Coal India shares could make a sharp comeback and reach levels of Rs. 250 to Rs. 260 per share, as per business news.
Understanding the Coal India Offer for Sale (OFS)
The recent downturn in Coal India’s share price can be attributed to the announcement of an Offer for Sale (OFS) by the PSU business. The OFS, priced at Rs. 225 per share, presents stakeholders with the opportunity to purchase shares at a discounted rate. This offering has triggered a sell-off among existing shareholders, as they liquidate their holdings to participate in the OFS. While the OFS is perceived as a strategic move by the company, it has exerted downward pressure on Coal India’s stock price in the short term.
Market Response and Analyst Insights
The market response to the Coal India OFS has been mixed, with some analysts expressing concerns about the stock price being offered at a significant premium. Stock market experts suggest that the downward pressure on Coal India’s share price is primarily driven by the anticipation of stakeholder liquidation ahead of the OFS subscription period. Despite the short-term challenges, positional investors are advised to consider buying opportunities at around Rs. 220 per share, anticipating a potential rebound post the conclusion of the OFS.
Strategic Trading Dynamics
The trading dynamics surrounding Coal India’s stock have become increasingly strategic in light of the OFS announcement. Shareholders are strategically offloading their stakes to avail themselves of the discounted offering through the OFS. This strategic maneuvering is driving the downward trend in Coal India’s share price, with investors positioning themselves to capitalize on the discounted share price offered by the PSU business. As the OFS concludes, market analysts anticipate a significant uptick in Coal India’s share price, signaling a potential turnaround in its performance.
Technical Analysis and Investment Recommendations
According to market experts, Coal India’s shares have found solid support at levels around Rs. 210 per share. This presents an opportunity for bottom fishing, with investors advised to consider purchasing the stock between Rs. 220 and Rs. 230 per share. Setting a stop loss at Rs. 210 per share can help mitigate risks associated with market volatility. Looking ahead, there is optimism that Coal India’s shares could witness a sharp rebound, potentially reaching levels of Rs. 250 to Rs. 260 per share, following the conclusion of the OFS.
