The divestment of Reserve Bank of India's 14 per cent stakeholding in primary dealer, Securities Trading Corporation of India (STCI), is likely to come through by the end of the current fiscal. This stake will be picked up by the existing shareholders on a pro-rata basis.
"The talks are on with the apex bank and we expect the divestment to be complete by the end of the current fiscal," D Basu, chairman of STCI said at a press meet here today.
Bank of India with 29 per cent stake is the majority shareholder in STCI (paid-up capital of Rs 500 crore), followed by the financial institutions (25 per cent), SBI and its associates (14 per cent), and other nationalised banks (19 per cent).
Basu pointed out that STCI was keenly looking at the possibility of market making in non-statutory liquidity ratio securities as part of its diversification into the non-gilt business in the fixed income sector. This move has been prompted by the fact that most of the corporate debt now has to be issued in dematerialised form and the Clearing Corporation of India will take care of the settlement needs.
At a later stage, this market making initiative of the Corporation could translate into undertaking underwriting business for the debt issues, he added.
Meanwhile, the STCI has reported a 31 per cent fall in net profit for the year ended March 31, 2001 at Rs 78.51 crore against Rs 113.65 crore in the previous fiscal. The company has attributed the lower profitability to adverse market conditions for most part of 2000-01. In view of the lower profits, it has declared a dividend of 10 per cent against 12 per cent last year.
It has posted a profit before tax (PBT) of Rs 134 crore in the first five months of the current fiscal mainly due to trading profits.
