Offer for Sale
A sale of shares by existing shareholders to the public, in which the proceeds go to those sellers and not to the company.
How it is identified
Test: the shares offered already exist and the issuer receives none of the proceeds
Unit
qualitative
In depth
An offer for sale changes who owns the company, not how much capital it has — share count stays the same, so there is no dilution, but no money reaches the business either. It is the standard route for a promoter or private-equity investor to monetise a stake, and it is also how listed companies meet minimum public shareholding requirements. Reading an IPO prospectus, the fresh-issue versus offer-for-sale split is the single most informative line about what the money is for. An offer for sale is neither good nor bad in itself; assuming that all IPO money funds growth is what causes trouble.
Worked example
Promoters sell 3 crore shares at ₹250 in an offer for sale, raising 3 x 250 = ₹750 crore for themselves. The company's share count and cash balance are unchanged; only the shareholding pattern moves, with promoter stake falling and public shareholding rising.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Offer for Sale” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.