Offer for sale

Shares sold by existing holders rather than issued new, so the money goes to the sellers and none to the company. Indian IPOs often combine an offer for sale with a fresh issue, and the split decides what the issue is for.

An IPO raising ₹1,200 crore, of which ₹800 crore is offer for sale, puts only ₹400 crore into the company. If the sellers are a private equity fund and the promoter, two-thirds of the issue is an exit, and the objects of the issue describe only the ₹400 crore.

Offer for sale also names a separate stock exchange window through which promoters of a listed company, including the government in disinvestments, sell large blocks to institutions and retail investors over a day or two, usually at a discount to the market price.

Read the split before the story.