Govt likely to throw away 9.33% stake in MMTC on March 14
4 March 2013 5:41 AM IST
The government's offer-for sale for offloading 9.33 per cent stake in trading giant MMTC is likely to hit the markets on 14 March, which could rake in about Rs 300 crore to the exchequer.
The Empowered group of Ministers (EGoM) on disinvestment, headed by Finance Minister P Chidambaram, is scheduled to meet on 12 March to decide on the floor price for the proposed stake sale.
'The EGoM for MMTC is scheduled to meet on 12 March and the issue is likely on 14 March,' official sources said.Government has shortlisted three merchant bankers, including IDFC, for selling over 9.33 crore shares or 9.33 per cent of its stake in MMTC in the current fiscal through an Offer For Sale (OFS).
Since the public float of the company is very less, the merchant bankers are in the process of evaluating the valuation of the shares which will be acceptable to investors.
'We are expecting somewhere between Rs 250-300 crore through the stake sale,' another official said.
The Department of Disinvestment (DoD) has shortlisted three investment bankers - Avendus, IDBI Capital Market Services and IDFC - to manage the stake sale of the PSU.
The stake sale would also help the company meet minimum 10 per cent public holding norms.
The DoD has initiated the process of investor meet for selling shares in the 'Miniratna' PSU, whose current public float is very less and hence the market valuation is too high.
The roadshows for the stake sale were held in Mumbai and Pune, an official said, adding that the roadshows focused mainly on domestic investors.
Of its shareholding of 99.33 per cent in MMTC, the government is considering divesting 9.33 per cent paidup equity share capital.
'MMTC is a different case. The merchant bankers are working on arriving at the valuation which would be acceptable to investors,' the official added.
The market capitalisation of the company is Rs 40,660 crore, of which the public free float was Rs 2,033 crore.
Stake sale in MMTC in the current fiscal will help government inch towards Rs 24,000 crore disinvestment target as per revised estimates, lower than Rs 30,000 crore as estimated in budget.
The government has so far raised over Rs 21,500 crore through stake sale and plans are afoot to expedite the process of stake sale in the remaining weeks to meet the target.
Apart from MMTC, the government is likely to divest stake in SAIL, NALCO and Rashtriya Chemical and Fertilisers (RCF) in fiscal ending 31 March.
SAIL PLANS Rs 13,000 CR CAPEX IN FY14, TARGETS 24-MTPA CAPACITY
State-run Steel Authority of India (SAIL) plans to spend Rs 13,000 crore next fiscal to part-fund ongoing expansion, which will take its installed capacity to over 24 million tonnes per annum (mtpa).
The proposed investment represents an increase of Rs 1,000 crore than SAIL is expected to put in the current fiscal, but Rs 1,500 crore lower than the budgetary estimate for the current fiscal, the 2013-14 Budget documents revealed.
The entire expenditure proposed forFY14 will be funded by SAIL from its internal resources. SAIL has 14 mtpa steel-making capacity and post-expansion, costing a total of Rs 72,000 crore, it will go up to 24 mtpa.Out of the Rs 13,000 crore capex forFY14, Bhilai Steel Plant is proposed to get the highest share at Rs 5,900 crore for installation of a 700 tonnes per day (tpd) oxygen plant, a hot metal de-sulphurisation unit and a railway track.The second highest fund allocation has been envisaged for Rourkela Steel Plant in which a total of Rs 2,400 crore would be spent for expansion and a 700 (TPD) oxygen plant and a coke oven gas holder.A sum of Rs 1,800 crore has been earmarked for expansion of SAIL's IISCO Steel Plant and rebuilding a coke oven battery.The Bokaro Steel Plant of the company would get Rs 1,425 crore for expansion and setting up of a steel processing unit at Bettiah, among others.An outlay of Rs 900 crore is proposed to be spent towards capacity expansion at SAIL's Durgapur Steel Plant and installation of Kangra steel processing unit.
JINDAL STEEL HIKES ITS PRICES BY UP TO `1,000 PER TONNE FOR THIS MONTH
Jindal Steel and Power (JSPL) has increased prices of its products by up to Rs 1,000 per tonne for the current month, an official said. For steel plates and coils, the company has increased the prices by Rs 1,000 per tonne, while prices of its long products has gone up by about Rs 500 per tonne, JSPL’s CEO-Steel Business V R Sharma said.
The Empowered group of Ministers (EGoM) on disinvestment, headed by Finance Minister P Chidambaram, is scheduled to meet on 12 March to decide on the floor price for the proposed stake sale.
'The EGoM for MMTC is scheduled to meet on 12 March and the issue is likely on 14 March,' official sources said.Government has shortlisted three merchant bankers, including IDFC, for selling over 9.33 crore shares or 9.33 per cent of its stake in MMTC in the current fiscal through an Offer For Sale (OFS).
Since the public float of the company is very less, the merchant bankers are in the process of evaluating the valuation of the shares which will be acceptable to investors.
'We are expecting somewhere between Rs 250-300 crore through the stake sale,' another official said.
The Department of Disinvestment (DoD) has shortlisted three investment bankers - Avendus, IDBI Capital Market Services and IDFC - to manage the stake sale of the PSU.
The stake sale would also help the company meet minimum 10 per cent public holding norms.
The DoD has initiated the process of investor meet for selling shares in the 'Miniratna' PSU, whose current public float is very less and hence the market valuation is too high.
The roadshows for the stake sale were held in Mumbai and Pune, an official said, adding that the roadshows focused mainly on domestic investors.
Of its shareholding of 99.33 per cent in MMTC, the government is considering divesting 9.33 per cent paidup equity share capital.
'MMTC is a different case. The merchant bankers are working on arriving at the valuation which would be acceptable to investors,' the official added.
The market capitalisation of the company is Rs 40,660 crore, of which the public free float was Rs 2,033 crore.
Stake sale in MMTC in the current fiscal will help government inch towards Rs 24,000 crore disinvestment target as per revised estimates, lower than Rs 30,000 crore as estimated in budget.
The government has so far raised over Rs 21,500 crore through stake sale and plans are afoot to expedite the process of stake sale in the remaining weeks to meet the target.
Apart from MMTC, the government is likely to divest stake in SAIL, NALCO and Rashtriya Chemical and Fertilisers (RCF) in fiscal ending 31 March.
SAIL PLANS Rs 13,000 CR CAPEX IN FY14, TARGETS 24-MTPA CAPACITY
State-run Steel Authority of India (SAIL) plans to spend Rs 13,000 crore next fiscal to part-fund ongoing expansion, which will take its installed capacity to over 24 million tonnes per annum (mtpa).
The proposed investment represents an increase of Rs 1,000 crore than SAIL is expected to put in the current fiscal, but Rs 1,500 crore lower than the budgetary estimate for the current fiscal, the 2013-14 Budget documents revealed.
The entire expenditure proposed forFY14 will be funded by SAIL from its internal resources. SAIL has 14 mtpa steel-making capacity and post-expansion, costing a total of Rs 72,000 crore, it will go up to 24 mtpa.Out of the Rs 13,000 crore capex forFY14, Bhilai Steel Plant is proposed to get the highest share at Rs 5,900 crore for installation of a 700 tonnes per day (tpd) oxygen plant, a hot metal de-sulphurisation unit and a railway track.The second highest fund allocation has been envisaged for Rourkela Steel Plant in which a total of Rs 2,400 crore would be spent for expansion and a 700 (TPD) oxygen plant and a coke oven gas holder.A sum of Rs 1,800 crore has been earmarked for expansion of SAIL's IISCO Steel Plant and rebuilding a coke oven battery.The Bokaro Steel Plant of the company would get Rs 1,425 crore for expansion and setting up of a steel processing unit at Bettiah, among others.An outlay of Rs 900 crore is proposed to be spent towards capacity expansion at SAIL's Durgapur Steel Plant and installation of Kangra steel processing unit.
JINDAL STEEL HIKES ITS PRICES BY UP TO `1,000 PER TONNE FOR THIS MONTH
Jindal Steel and Power (JSPL) has increased prices of its products by up to Rs 1,000 per tonne for the current month, an official said. For steel plates and coils, the company has increased the prices by Rs 1,000 per tonne, while prices of its long products has gone up by about Rs 500 per tonne, JSPL’s CEO-Steel Business V R Sharma said.
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