Hind Copper selloff nets Rs 808 cr, thanks to LIC
“Investors should not risk an entry into companies run by public sector undertakings unless they are available extremely cheap,” said Ramdeo Agarwal, joint MD, Motilal Oswal Securities. At the issue price of R155, the trailing 12-month PE multiple for the stock works out to 44 while at the current market price its an expensive 61 times.
Of late, several PSUs including NALCO, NMDC, Oil India, NTPC and MMTC have been in the limelight as possible candidates for divestment. The government said on Friday the NMDC sale could be next. Analysts have identified NMDC as the only attractive bet given its status as the biggest domestic iron ore provider.
Meanwhile, the government’s plan to offload a 9.5% stake in state-run power producer NTPC has also received the Cabinet nod. The sale, which is estimated to raise about Rs 13,000 crore, is expected to take place in January. The NTPC share fell 2.6% or R4.20 to R159.20 on Friday. Even as NTPC enjoys a monopoly in its business segment, experts are not enthused about the offered sale given the limited opportunity it enjoys in the merchant power segment.
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