The cabinet has finally approved share sale in state-run miners Coal India and Hindustan Copper as part of the ongoing disinvestment road-map.
We had earlier covered a possibility of Hindustan Copper Disinvestment and earlier today the cabinet approved it along with share sale in Coal India too. The disinvestment in these two companies is expected to fetch the government close to $3.7 Bn
Hindustan Copper Disinvestment Details
Government will divest 20% stake in Hindustan Copper out of which 10% will be fresh equity. The government expects to raise up to $1.06 Bn from this transaction
Coal India Disinvestment Details
Government will divest 10% stake in Coal India through an IPO. In what could be the largest share sale ever, the government expects to make up to $2.7 Bn out of Coal India share sale
This marks the addition of two new companies added to the government’s plan of disinvestment in over 60 state run enterprises to raise close to $8.5 Bn.
Hindustan Copper Zooms 14% on the disinvestment announcement
Apparently, the markets rejoiced on the announcement of share sale and Hindustan Copper zoomed close to 14% in the early trade hours today. The stock saw good response both on BSE as well as NSE.
On BSE, Hindustan Copper jumped 14.27 and touched a high of Rs 537 and is now trading at Rs 526 odd. On NSE, the stock jumped 11.57% to Rs 524 odd. The move is interesting since overall the markets are trading marginally in RED.
The initial response to the announcement has definitely been positive for Hindustan Coppers. However, it will be interesting to see public interest when both these shares are available for picking in the markets.
What do you think? Will government be able to extract the value it is expecting from the disinvestment of state run companies