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HindustanCopper shares at 71% discount; issue opens today

HindustanCopper shares at 71% discount; issue opens today

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New Delhi:

Wooing investors with a 71 per cent discount to the market rate, the government yesterday announced a base price of Rs 155 a share for the sale of a 4 per cent stake in HindustanCopper, the maiden disinvestment in the current fiscal year that can raise up to Rs 1,376 crore for the cash-pressed exchequer.

The public offer opens today, setting the tone for the government's disinvestment programme of Rs 30,000 crore which it aims to complete in less than five months of the current financial year.

"(The) Government of India has informed the BSE (Bombay Stock Exchange) that the floor price for the sale shall be...Rs 155 per equity share of Hindustan Copper," the state-run firm said in an exchange filing yesterday.

Although the minimum target for the government is to sell 4 per cent of its 99.59 per cent stake in HCL, the offer size can go up to 9.59 per cent if investors respond well.

HCL has kept 25 per cent of the issue reserved for mutual funds and insurance companies.

"No single bidder other than mutual funds and insurance companies shall be allocated more than 25 per cent of the size of the sale," the company added.

The share sale will take place on the separate window of the stock exchanges -- BSE and NSE. It has kicked off at 9.15 a.m. and will close at 3.30 p.m.

"HCL is a very illiquid stock and the current market price is not an indicator for anything. I think it is very
mature and good thing. I expect it to be successful," said Sudip Bandhopadhyaya of Destimoney Securities.

The HCL issue has high stakes for the government which wants to tap at least Rs 30,000 crore in the current fiscal year to meet its fiscal deficit of 5.3 per cent.

Other issues expected to hit the market in the near future are of NMDC and Oil India.

Story first published on: November 23, 2012 10:07 (IST)

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