Hind Copper in deep red
PSU Hindustan Copper has hit a 52-week new low at Rs.65 and though it has recovered from this, it remains deeply in the red, down over 4.5%.
The stock has sunk, like MMTC did when the Govt announced divestment plans. Today, the Empowered Group of Ministers' (EGoM) are likely to meet and decide on the base price to divest Govt’s stake. The trend is to see a base price much below the ruling market price and the traders are wary of this discounted price. MMTC continues to remain amongst the top losers though its been more than a fortnight since the stake sale happened. Its shares were sold at a whopping 72% discount to the market price. The Govt is offloading stake to meet the minimum public holding requirement but this mode of selling stake at such cheap rates is at the cost of existing shareholders and this is keeping away investors away from such PSU stocks.
In Hindustan Copper, the Govt currently has 94.01% stake and it is offloading 4.01% stake. In Nov’12, the company had sold 5.58% stake at an average price of Rs.156.56/share and the stock is currently at Rs.74. The OFS is expected to hit the market tomorrow, 3rd July.