The Rs 10,000 crore ($2 billion) Oil and Natural Gas Corporation offer for sale of 142 million shares was today sold out 15 minutes after it opened for subscription.

At the end of the first day, the issue was subscribed 2.8 times (Rs 28,000 crore worth of bids were received), according to data posted on the Bombay Stock Exchange Web site at 8 p.m.

Merchant bankers said the mad scramble in the first few minutes was due to an "early bird" clause in the ONGC offer, which gives the government discretion over allotment  to qualified institutional buyers. ONGC roadshows are currently on in different parts of the world.

Reacting to the development, Divestment Minister Arun Shourie said: "For all of us in the divestment ministry, this is a great milestone. These six issues (ONGC, Gail, IBP, CMC, IPCL and Dredging Corporation) have redefined the perception of capital markets in India."

With ONGC's strong showing, the government has raised over Rs 45,000 crore (Rs 450 billion) from the capital market in the past month.

"In these six weeks we would have raised three-and-a-half times what was raised in the three years between 2000 and 2003, and a quarter more than has been raised in the equity market in India since 1998-99," Shourie said.

Shourie said the government expected to mop up at least Rs 13,100 crore (Rs 131 billion) from the six public issues.

Hemendra Kothari, chairman of DSP Merrill Lynch, one of the lead managers to the ONGC issue, said: "The response has been very good. There is still more response to come." The response from retail investors would be known only towards the end of the offer period, he added.

"From Maruti to ONGC, the Indian capital market has come a long way: from a Rs 1,000 crore (Maruti) public issue to a Rs 10,000 crore (ONGC) issue. The biggest ever equity issue has been oversubscribed on the first day. This is a great thing to happen," Uday Kotak, chairman, Kotak Mahindra Capital, co-book running lead manager to the issue said.

Sources involved in the process said retail participation was phenomenal on the first day itself. Usually retail investors start coming in only on the last day of any public offer.

The interest shown by global funds was unprecedented, market sources said. "They are all new investors, who have previously shown no India focus in their investment strategies," the sources added.

Part of the response was also because the stockmarket regulator had permitted lead managers and book runners to issue participatory notes to their overseas clients for the issue.

With roadshows lined up in various major "money centres", investment bankers expect the issue to mop up at least Rs 50,000 crore (Rs 500 billion).

The ONGC issue is the biggest in India's capital market history, with 142.59 million shares being sold through the book-building route in a price band of Rs 680-750. Retail investors will be offered a 5 per cent discount on the final cut-off price.

Merchant bankers said the bulk of the bids from institutional investors had come at the lower end of the price band at Rs 680.

The juggernaut gathers momentum

• The ONGC issue rewrites history
• The Rs 10,000 crore ONGC offer subscribed in first 15 minutes.
• Merchant bankers said the bulk of the bids from institutional investors came at the lower end of the price band of Rs 680.
• Subscription news perks up BSE Sensex 64 points (1.1%) and BSE PSU index 3.95%.
• The Dredging Corp scrip surges 20 per cent higher to Rs 588.70.
• More than Rs 45,000 crore mobilised in the last 15 days --  Rs 10,119 crore (Rs 101.19 billion) was raised in the last five years.