New Delhi: Shares of Hindustan Copper Ltd on Wednesday fell as much as 3% in the morning trade as the government’s 4.01% share sale commenced on bourses.
The scrip touched a low of Rs.70.70 in the opening trade, 2.68% lower than previous close on the BSE. After the close of market hours on Tuesday, a government panel had cleared the 4.01% stake sale in Hindustan Copper at a base price of Rs.70 a share.
The base price was at a discount of 3.65% over the closing price of Rs.72.65 apiece. On the National Stock Exchange, the company’s scrip hit a low of Rs.70.65, down 2.35% over previous close.
Over 300,000 shares of Hindustan Copper changed hands on both BSE and NSE in the early hours of trade on Wednesday.
The government holds 94.01% stake in the company. The stake sale would make the company compliant to the minimum 10% public holding norm of market regulator the Securities and Exchange Board of India (Sebi).
The sale of 4.01% stake, or over 37.1 million shares, through offer for sale (OFS) route at Rs.70 per share will fetch around Rs.260 crore to the exchequer. Axis Capital, ICICI Securities, Kotak Securities, SBICAP Securities and UBS Securities India are acting as brokers for the share sale.
The government had in November last year sold 5.58% stake in Hindustan Copper through the OFS route at an average price of Rs.156.56 apiece. The stake sale fetched Rs.808 crore to the exchequer.
In September 2012, the Cabinet had approved 9.5% stake sale of Hindustan Copper. The government had then decided to go ahead with only one tranche of the issue and get a good price from the auction. Hindustan Copper is the second PSU to hit the markets in the current fiscal.
Last month, the government had raised Rs.568 crore through divesting 9.33% stake in MMTC Ltd. The government plans to raise Rs.40,000 crore through disinvestment in 2013-14.