EGoM to decide on Nalco stake sale floor price tomorrow
Mar 10 2013 , New Delhi
The Empowered Group of Ministers (EGoM) on disinvestment, headed by Finance Minister P Chidambaram, is scheduled to meet tomorrow to decide on the base price for the share sale, sources said.
The share sale is likely to hit the markets on March 13, they added.
The Department of Disinvestment (DoD) has held roadshows in Singapore, Hong Kong, Japan, the US and the UK on February 19 for disinvestment of the state-run aluminium company.
The sale of 12.5 per cent stake, or 31.31 crore shares, of Nalco is expected to fetch around Rs 1,400 crore to the exchequer at the current market price. Shares of Nalco on Friday closed at Rs 44.90, up 3.70 per cent on the BSE.
The government currently holds 87.15 per cent stake in Nalco. The government had in November last year deferred disinvestment of Nalco citing poor second-quarter performance which raised valuation concerns and said the stake sale would happen only after the third quarter results.
The aluminium major reported a more than two-fold jump in its October-December quarter net profit to Rs 118.94 crore, on the back of improved sales. The National Aluminium Company (Nalco) had a profit of Rs 51.22 crore in the same period last fiscal.
"We expect to get good valuation of Nalco. Last time the merchant bankers advised to defer the offer to March quarter. This time we want to do it only when the market is stable," sources said.
Enam Securities, SBI Caps and IDFC are merchant bankers for the Nalco disinvestment.
The Cabinet Committee on Economic Affairs (CCEA) had in September approved disinvestment in the Navratna PSU.
Following the stake sale, the government's holding will come down to 75 per cent in the company.
The stake sale would happen through the Offer for Sale (OFS) or auction route. The paid-up capital of the company as on March, 2012 stood at Rs 1,288.62 crore.