The Indian Government has announced an offer for sale (OFS) for up to a 5% stake in Indian Railway Catering and Tourism Corporation (IRCTC).

The floor price of the OFS is Rs680 a share, which marks a 7.4% discount from Wednesday’s close of Rs734.70 on the BSE.

The offer will be open for subscription on the NSE and BSE on 15 and 16 December.

Overall, the transaction will involve the sale of 40 million equity shares. It will start with 20 million shares being offered for sale to non-retail that constitute a 2.5% interest in the firm.

This will be followed by a further 20 million shares representing a 2.5% stake being offered to retail investors.

The transaction is expected to help the government earn Rs27bn (around $327bn).

Citigroup Markets India, JM Financial Institutional Securities, and Axis Capital will serve as the brokers for the share sale.

According to various media reports, the shares of IRCTC have tumbled 5% since the news.

At present, the Indian government has a 67% holding in the company.

The firm saw a 42.5% post-tax profit growth year-on-year for the quarter that ended September 2022 (Q2 FY23).

Revenue from operation stood at Rs8.06bn in the quarter, up from Rs4.05bn in the prior year.