The share price of Nalco spurted on the Bombay Stock Exchange (BSE) today following the Centre's assurance that it will carry on with its disinvestment programme.
The stock of the state-run aluminium major closed higher by 3.40 per cent at Rs 87.70 after hitting an intra-day high of Rs 89.30 on the BSE.
It registered a volume of over 1.96 lakh shares on the BSE and 5.75 lakh shares on the National Stock Exchange (NSE). In 19 sessions between September 3 and October 1, 2002, the Nalco stock shed 26 per cent to Rs 84.80 from Rs 114.55 on fears of a delay in its privatisation.
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Dealers said the renewed buying on the Nalco counter was mainly due to the statement of Prime minister Atal Behari Vajpayee that the government will carry on with the disinvestment programme.
Reports that the state-run aluminium major would soon export alumina to all major metal producing countries, including Russia and China, also helped the stock to rise.
The company has decided to make fresh investments in mineral-rich Orissa. Analysts said these developments are significant, because the company already exports over 50 per cent of its production. They said the stock rose purely on divestment hopes as there is nothing to cheer about -- following the subdued demand as well as prices of aluminium in the domestic as well as international markets.
Meanwhile, there were reports that the Centre is likely to shortlist prospective bidders for selling its 29 per cent equity stake in Nalco by the end of the current week. As many as 15 initial bids have been received in this connection.
Those in the fray include the Birla group-promoted Hindalco Industries and Sterlite Industries, Switzerland-based Glencore, BHP-Billiton of Australia and a host of other foreign companies.
The Centre proposes to dilute a 60 per cent stake in the company through a combination of strategic sale, American depositary receipts and domestic issues. While 29 per cent stake will be offload to a strategic partner, 20 per cent will be offered in foreign markets and another 10 per cent to domestic investors.
The Centre has mandated ABN Amro-Rothschild-Enam Securities as global advisors, and has appointed ICICI securities-J P Morgan as co-book runners. It had earlier set a net worth criteria of $250 million for prospective bidders while deciding not to impose any turnover criteria.
Meanwhile, coal and mines minister Uma Bharti is said to have opposed the Nalco sale pending completion of its modernisation programme.