PSU stocks bullish on FM announcement

Mumbai, Nov 15 | Updated: Nov 16 2005, 05:43am hrs
Union finance minister P Chidambaram's announcement in Mumbai on November 9 of the government's plan to partially divest equity in the profit making public sector undertakings (PSUs), other than Navratnas has helped the side counter stocks in the category to rally at the bourses. The Bombay Stock Exchange (BSE)'s PSU Index has outperformed its flagship benchmark, the Sensex in last thre trading sessions. While the former gained 3.87% against the later's gain of 2.23% since November 9.

Mr Chidambaram said that the Union government has already had discussions to divest some portion of the profit making PSU companies. On this announcement, the stocks prices of the profit making PSUs have gone upto 6.01% during the period.

The stock of Bharat Electronics Ltd (BEL) has gone up the highest by 6.01% at Rs 842.90 followed by Neyveli Lignite Corporation Ltd which went up by 5.49% at Rs 75. Similarly, Balmer Lawrie & Company Ltd has gone up by 4.40% at Rs 453.30, Engineers India Ltd went up by 3.9% at Rs 626, Shipping Corporation of India Ltd went up by 3.38% at Rs 154 and Power Trading Corporation (PTC) gained by 2.24% at Rs 50.20.

An analyst from a domestic brokerage firm said that investor sentiment towards PSU stocks have strengthened since the finance minister's statement.

The government plans to divest its shareholding as it has to mobilise resources for its budgetary deficit in the next year.

However, some of the PSU stocks have lost steam at the bourses during the period include State Trading Corporation of India, which shed 0.07% at Rs 149, Hindustan Organic Chemicals Ltd that lost 2.48% at Rs 33.45.