Shares of state-run iron ore miner NMDC tanked nearly 5% on Tuesday as the government begun the disinvestment at a discount of 5% which led the company to lost about Rs 2,300 crore in the market capitalisation.
Shares of state-run iron ore miner NMDC tanked nearly 5% on Tuesday as the government begun the disinvestment at a discount of 5% which led the company to lost about Rs 2,300 crore in the market capitalisation. The President of India, acting through and represented by the Ministry of Steel, Government of India, is the promoter of NMDC Limited proposed to sell up to 4.74 crore equity shares (1.5%) at a floor price of Rs 153.5. The floor price set by the government for the disinvestment was at a discount of 5.15% from the Monday’s closing price of Rs 161.85 on BSE. Following this, the stock of NMDC posted its biggest intraday fall since 18 December 2017 and the first decline in last seven sessions. NMDC shares tumbled as much as 4.78% to the day’s low of Rs 154.1 before closing down 4.48% at Rs 154.6.
Due to a sharp dip in share prices of NMDC, the PSU company lost as much as Rs 2,293.82 crore to Rs 48,913.75 crore in the market capitalisation on Tuesday. The company commanded a market capitalisation of Rs 51,207.57 crore as per Monday’s closing price of Rs 161.85 on BSE. The two-day offer for sale (OFS) today opened for institutional investors and will open for retail investors on Wednesday. The sale of 4.74 crore equity shares would garner an amount of Rs 728 crore to the exchequer.
The government has already raised over Rs 52,500 crore in current fiscal through stake sale in PSUs, including the listing of insurance PSUs and exchange-traded fund. It has set an ambitious target of raising Rs 72,500 crore for disinvestment in the current financial year. Of this, Rs 46,500 crore is to be raised through minority stake sale in PSUs and Rs 15,000 crore from strategic sales. Another Rs 11,000 crore is to come from the listing of insurance companies.
Meanwhile, the benchmark equity indices Sensex and Nifty kissed fresh peaks on Tuesday but quickly pared off the gains as investors turn cautious ahead of major Q3 earnings due tomorrow and the macroeconomic data scheduled for later this week. BSE Sensex rose as much as 134.73 points to hit an all-time high of 34,487.52 before closing up 90.4 points at 34,443.19 while NSE Nifty added 35.55 points to mark the record high of 10,659.15 before settling 13.4 points higher at 10,637.