Hindustan Copper falls 8% as govt launches 6% OFS; full greenshoe exercised

Shares of Hindustan Copper fell nearly 8% on Tuesday, August 25, after the government launched an offer for sale (OFS) of up to a 6% stake in the state-owned copper producer.

The government initially offered a 3% stake, with an option to sell an additional 3% through the greenshoe option, at a floor price of ₹514 per share. The floor price represented a discount of around 9.5% to Hindustan Copper's Monday closing price of ₹567.90.

The OFS received a strong response from institutional investors, with the issue oversubscribed 3.41 times on Day One, according to DIPAM Secretary Arunish Chawla. Following the response, the government has decided to exercise the entire 3% greenshoe option, taking the total stake on offer to 6%.

Retail investors and employees will get an opportunity to bid on Wednesday, August 26.

Govt holding to fall to around 60%

If the entire 6% stake is sold, the government could raise around ₹3,000-3,200 crore through the OFS.

As of June 2026, the government held a 66.14% stake in Hindustan Copper. The full 6% stake sale would bring its holding down to around 60%.

Speaking to CNBC-TV18 before the greenshoe option was confirmed, Chawla had said the government was confident of selling the full 6% stake, including the greenshoe.

“The forecasts are good. The future is even better,” Chawla said, pointing to Hindustan Copper's plans to modernise its mining operations and increase output.

He also said the company has “very far-sighted capital investment plans” to expand and modernise its mining operations.

Why the government is selling

Chawla said the government is deliberately leaving room for Hindustan Copper to raise capital from the market and fund its expansion. The stake reduction is part of a broader capital-management approach under which the government balances stake sales with the company's future investment requirements.

He said the timing of the OFS was favourable as metal prices are rising, while Hindustan Copper is also looking to increase production.

On the possibility of further stake sales after the government's holding falls to around 60%, Chawla said future decisions would depend on the company's capital requirements and the government's broader asset-management strategy.

What makes Hindustan Copper stand out?

Hindustan Copper is India's only listed pure-play copper producer, giving investors direct exposure to the country's copper demand and the broader energy-transition theme.

The company also has access to around 45% of India's copper ore reserves and resources, according to Anand Rathi estimates.

Based on Anand Rathi's estimates, the stock's valuation could moderate significantly if earnings growth materialises, with the forward P/E falling from around 54x in FY26 to 25x by FY28E.

Hindustan Copper shares closed 7.45% lower at ₹531.40 on Tuesday. The stock has gained around 1.67% so far in 2026 and 125% over the last 12 months.