Dredging Corporation shares rally 10% as govt looks to divest stake

Shares of Dredging Corporation rallied 10 per cent in early trade on Friday after the Union Cabinet on Thursday approved the strategic sale of government stake in the company to a consortium of four ports.

The scrip was trading 9.99 per cent up at Rs 383.15 at around 9.35 am (IST), while the BSE Sensex was down 90 points at 35,147 at around the same time.

The government currently holds 73.44 per cent in Dredging Corporation (DCIL).

“CCEA has given in principle approval for strategic disinvestment of 100 per cent Government of India's share in DCIL to a consortium of 4 ports, namely Vishakhapatnam Port Trust, Paradeep Port Trust, Jawaharlal Nehru Port Trust, and Kandla Port Trust," the release said.

The approval will further facilitate the linkage of dredging activities with the ports, keeping in view the role of the DCIL in expansion of dredging activity in the country as well as potential diversification of ports into third-party dredging.
The co-sharing of facilities between the company as well as ports shall lead to savings for ports. This would further provide opportunities for larger investment in DCIL as integration with ports shall help in effective vertical linkage in the value chain, according to the media release.