Oil and Natural Gas Corp said on Thursday that it expects good response to the public offering of 10 per cent government shares that opens on March 5.

"The fundamentals of the company are very strong and we see investors waiting for this (public issue)," ONGC chairman and managing director Subir Raha told reporters in New Delhi.

The issues book running lead managers, DSP Merrill Lynch and JM Morgan Stanley too agreed with Raha's assertion that the public issue of 142 million equity shares would be over-subscribed.

Asked if the lukewarm response to the public offer of government's residual 26 per cent equity in petro retailer IBP Co Ltd would reflect on India's largest ever public sale of equity shares, DSP Merrill Lynch chairman Hemendra Kothari said, "There is an unprecedented demand and I am 100 per cent sure that the issue will be successful."

Among the six public issues for sale of government equity ONGC is seen to be the most attractive and is expected to raise Rs 10,000 crore (Rs 100 billion), to bridge the government's revenue targets from sale of state firms.

Khotari predicted that even the IBP issue, which till now has been subscribed only 3 per cent, would be eventually over subscribed.

"IPCL public issue has been over-subscribed, CMC has been over-subscribed and DCI has good potential," he said.

"ONGC has a very strong balance sheet and we see its profitability growing further once natural gas pricing is liberalised," Kothari added.

Raha said 10 per cent of the 142,593,300 equity shares being offered have been reserved for the employees of the company and an equal amount for the shareholders of ONGC and its subsidiary MRPL.

Of the remaining 114,074,640 shares, maximum of 50 per cent shall be available for allocation on a discretionary basis to Qualified Institutional Buyers, 25 per cent for non-institutional bidders and the remaining 25 per cent for the retail investors.

The issue, which opens on March 5, will close on March 13 and the government will decide on a band of bidding or a floor price a day prior to the opening of the issue, he said.