Investors may be losing interest in PSU stocks as they reassess feasibility

Market players say privatisation buzz, hopes of hefty dividends post tax cut, and buyback arbitrage had kept many of the PSU counters ticking

Investor interest in the stocks of public sector undertakings (PSUs) — which had reached dizzy heights in the last two months — seems to be fizzling out as they reassess the feasibility of their expectations. During the two months ending October 31, the Nifty PSE (public sector enterprise) index had rallied 14 per cent, outperforming the benchmark Nifty, which rose 7.7 per cent. Some individual PSUs, such as General Insurance Corp of India (GIC RE), New India Assurance, and Bharat Petroleum Corp (BPCL), had jumped more than 50 per cent each.

Market players say privatisation buzz, hopes of hefty dividends post