OFS — Offer for Sale
An OFS (Offer for Sale) is an exchange-run mechanism through which promoters or other large shareholders of a listed company sell shares they already own to institutional and retail bidders — no new shares are created.
The OFS window was introduced largely to help promoters comply with SEBI's minimum public shareholding requirement (at least 25% of a listed company held by the public). It is a transparent auction on the exchange: the seller announces a floor price, bids come in during the offer day(s), and allocations happen at or above the floor, typically with a portion reserved for retail bidders.
The critical difference from a QIP or rights issue is that an OFS raises money for the selling shareholder, not the company. The share count does not change, so there is no dilution — but the promoter's stake falls, and the market reads the seller's identity and motive closely.
OFS events are announced through exchange filings, usually a day before the issue opens, and the floor price — often set at a discount to the market price — anchors near-term trading.
In practice
The Government of India, Hindustan Copper's promoter, offered up to 2.9 crore shares (3%) through an OFS at a floor price of ₹514, with an option to sell another 3% if oversubscribed. Non-retail bidding was on 25 August 2026 and retail on 26 August, with no retail discount. Read the filing (24 Aug 2026) →
Common questions
Who can bid in an OFS?
Any investor with a trading account can bid through their broker. At least 10% of the offer is reserved for retail investors, meaning individuals bidding for up to ₹2 lakh, and the rest goes to non-retail bidders such as institutions, companies and wealthier individuals. Retail investors may also bid for any part of the non-retail portion left unsubscribed.
How long does an OFS stay open?
Two trading days. Non-retail investors bid on the first day and retail investors on the second, and non-retail bidders can choose to carry unallotted bids forward to the second day. Bids are placed during normal market hours, and the seller announces the size and floor price to the exchanges before the offer opens.
Can retail investors get a discount in an OFS?
Only if the seller offers one. The OFS notice states whether retail bidders get a discount to the cut-off price; government sales have often included one, but many offers carry none. The government's August 2026 OFS in Hindustan Copper, for example, set a floor price of ₹514 with no retail discount.
What is the difference between an OFS and a block deal?
An OFS is an open auction on the exchange: the seller announces a floor price, anyone can bid over two days, and retail investors have a reserved quota. A block deal is a single pre-agreed trade between known parties in a 15-minute window, priced within 3% of a reference price. Both move existing shares, and neither creates new ones.
Is the offer for sale in an IPO the same as an OFS on the exchange?
No, though the idea is the same. In an IPO, the offer-for-sale portion is sold through the book-built issue alongside any fresh shares before the company lists. The stock-exchange OFS is a separate mechanism for companies that are already listed and runs on the exchange's own platform. In both cases the money goes to the selling shareholders, not the company.
How stocks tend to react
Stocks commonly trade down toward the OFS floor price when one is announced, since the floor is usually below the market price and supply is incoming. The medium-term read depends on why the promoter is selling — regulatory compliance is routine, while aggressive stake reduction attracts scrutiny.
MarketPing measures this instead of guessing: every analysed announcement carries the stock's actual price reaction across 14 horizons, and the Reaction Lab aggregates how each category of announcement has historically moved stocks.
Related terms
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Educational content, not investment advice. Regulations and tax rules change — verify current rules before acting.