Financial advisers say interest from retail investors in the Meridian Energy share sale is not as strong as for the Mighty River Power float.
However, they say growing demand from New Zealand and offshore institutions should mean retail investors will get a good deal.
The three-week sale of up to 49% of Meridian opened last week.
The shares are likely to cost $1.50 - $1.80 each.
However, small, or retail, investors will have a price cap of $1.60 to be paid in two instalments.
A planner at financial advisory firm Camelot, Sam Walter, says Meridian should have been the first state-owned power company to be sold.
He says the partial payment is more attractive and it should mean that New Zealanders who invest will get a good yield for the first 18 months.
Mr Walter says it should not be New Zealanders' only investment but part of a well diversified strategy.
He says investors may have been put off by their experience with the Mighty River Power float, with the share price still below the issue price.
Mr Walter says some New Zealand investors' attitudes towards share investing are still tainted from the 1987 crash.
"My real fear is that some of those people didn't look at the sharemarket up until Mighty River Power and all of a sudden they've had another negative share experience."
Craigs Investment Partners head of private wealth research Mark Lister says a report of strong offshore interest is a good sign for small investors.
The Australian Financial Review says a number of Australian and Asian funds are believed to have made early orders for Meridian amid fears strong demand out of New Zealand will see the float's global allocation scaled back.
Offshore funds expect to be allocated about $400 million of stock, based on the Government's goal of at least 85% of the company being owned by New Zealanders.
