Fundamental Glossary / Indian Stock Market-Specific Fundamentals
Offer for Sale (OFS)
A sale of existing shares by selling shareholders. The company does not receive the money. SEBI also runs a separate exchange OFS mechanism for already listed shares.
Formula
In an IPO, the OFS portion is existing shares. On the exchange, the OFS window is a defined route for promoters and other sellers to sell listed shares to the market in one session.
What it means
An offer for sale transfers ownership. It does not strengthen the company's balance sheet, because no new capital arrives.
The exchange OFS mechanism is often how a promoter meets the minimum public shareholding rule or trims a stake. The floor price and the seller are disclosed.
How to read it
A large OFS is a supply event. It can also be the promoter cutting exposure. Those are different stories only if you know what the seller will do with the rest of the holding.
What to watch
Do not model IPO proceeds as cash on the balance sheet until you have subtracted the offer-for-sale portion and the issue expenses. Only the fresh issue is the company's cash.
This note explains the term. It is not a research recommendation, a target price, or a comment on any security. Ratios and regulatory thresholds change; use the latest filing or circular for a live figure.