Offer for Sale (OFS)

Published Oct 17, 2024

What is OFS?

OFS (Offer for Sale) was introduced by the Securities and Exchange Board of India (SEBI) in February 2012. It allows promoters of listed companies to dilute their stake through an exchange platform. In this process, promoters act as sellers, and bidders include market participants such as individuals, companies, qualified institutional buyers, and foreign institutional investors.

The OFS facility is available on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). Only the top 200 companies by market capitalization (in any of the four completed quarters) are eligible to use this facility. OFS bids require a 100% cash margin.

 

The OFS Advantage

  • Simplified Process: There is no need to fill out an application form since the system is entirely platform-based.
  • Faster Refunds: In case of no allotment, the money is refunded on the same day.
  • Transparency: The process is more transparent compared to Initial Public Offers (IPO) as the system operates on a real-time basis.
  • Multiple Bids: Investors can place multiple bids above the floor price set by the company, unlike in IPOs where only one bid price is allowed.
  • Flexibility: Bids can be modified or canceled at any time during OFS market hours.

 

How to Bid in OFS

  1. In an OFS, buyers need to place bids to acquire shares.
  2. Companies set a floor price, below which bids are not accepted. Buyers must bid at or above the floor price to be considered.
  3. Cut-Off Price Bidding:
    # Bidding at the cut-off price ensures that retail investors get an allotment.
    # The allotted quantity depends on the demand at various price points.
  4. Once bids are placed, shares are allocated based on final price discovery.

With Stocko, investors can apply for OFS under the Retail category only. The application amount must be a minimum of ₹10,000 and a maximum of ₹2 lakh.

 

Note

  • Cut-Off Time: The deadline for placing OFS orders is 2:30 PM.
  • Application Charges: A fee of ₹99/- per application will be charged, regardless of whether the client gets an allotment or not.
  • Funding:
    # Stocko will not provide funding for your OFS purchase.
    # In case your account results in a debit balance post the allotment of OFS, interest will be charged on the outstanding amount.

 

For more details on the Offer For Sale (OFS) process, please refer to the attached document.

OFS FAQs – Retail Individual Investors (NSE) >


Frequently Read Articles

Still need help?

South Asian Stocks Ltd. : NSE Member Code 09073, BSE Member Code 6329, MCX Member Code : 55215 , NCDEX Member Code : 1233 NSDL : IN-DP-474-2020 . SEBI Registration No. INZ000164738
Compliance Officer: NSE,BSE,MCX,NCDEX,NSDL : Mr RK Jain , 011-40409999 support@stocko.in
Registered Office : 3rd Floor, Building No.5, Local Shopping Complex, Rishabh Vihar, Near Karkarduma Metro Station. East Delhi – 110092


For any complaints related to South Asian Stocks Ltd email at complaints@stocko.in
Please ensure you carefully read the risk Disclosure Document.
Procedure to file a complaint on SEBI SCORES: Register on SCORES portal. Mandatory details for filing complaints on SCORES: Name, PAN, Address, Mobile Number, E-mail ID. Benefits: Effective communication, Speedy redressal of the grievances