Tata Communications has rallied over 5% at Rs 259 after the cabinet approved spinning off surplus land held by the company into a special purpose vehicle (SPV) majority owned by the state.
“As part of the sale plan, the Government will hold 51.12% in Hemisphere Properties India Ltd (HPIL), the company into which the 773 acres of surplus land will be transferred to. The sale may fetch the exchequer Rs 6,150 crore,” the report suggests.
Tata Communications is a former state monopoly in which Tata Group took a 50% stake in 2002. The government still owns 26% of the company. The spin-off will pave the way for the sale of the land, and could be a breakthrough for the company, which has said the unresolved matter has hindered its equity raising plans.
The stock opened at Rs 250 and has seen healthy trading volumes. A combined 352,597 shares have already changed hands in morning trades, as against an average of less than 100,000 shares that were traded daily in past two weeks on the NSE and BSE.
