Oil India Ltd's initial public offering has been put off to the next fiscal because of volatile market conditions.

"Market is volatile and conditions bad for an IPO. We do not think we can go ahead with the plans under such a scenario," OIL director (finance) S Ananthkumar told reporters in New Delhi.

OIL, the nation's second biggest state-run oil and gas explorer, was to launch its IPO of 2.64 crore equity shares on November 10, but the reversal of fortunes on the stock markets led to its deferment by a few weeks. It now has been put back for at least a couple of months.

"We are closely watching the market conditions. Whenever it appears that the market has stabilised, we will launch it," Ananthkumar said but refused to put any date to the offering.

Asked if the IPO may come only next fiscal, he said: "as of now, we can take that view."

OIL, he said, has capital market regulator Sebi's approval, valid till September 10, 2009.

"We have in consultations with the ministries of petroleum and natural gas and finance and department of disinvestment deferred the IPO for the time being."

"IPO timing will have to be reworked in consultations with the government," he said.

The government holds 98.13 per cent stake in OIL, which produces close to four million tonnes of crude oil annually.

Alongside the IPO, government is to sell 10 per cent of its current holdings in OIL to Indian Oil [Get Quote] Corp, Hindustan Petroleum and Bharat Petroleum.

Ananthkumar said irrespective of the market conditions, OIL's proposed offering had received encouraging response.

"Based on the feedback we have received, we are confident of the offering."

Post-IPO and equity transfer, government shareholding in the company will come down to 78.43 per cent.

IOC will hold 4.45 per cent equity stake in the expanded equity-base while HPCL [Get Quote] and BPCL [Get Quote] would hold 2.23 per cent each. Public holding would be 12.66 per cent.

The official also said, "We have fully complied with Sebi regulations on independent directors on the company board. We now have six independent directors on our board besides one government director".

The appointment of independent directors on OIL board had been holding up the IPO since early this year.

Due to turbulent market conditions, several IPOs were shelved earlier this year, including those by realty giant Emaar MGF, Wockhardt Hospital and SVEC Constructions.

State-run power firm NHPC's initial offering had also been deferred earlier this month.