MMTC bounces back from record lows as EGoM defers stake sale

NEE DELHI: MMTC Ltd bounced back by over 11 per cent from its record lows of Rs 280.25 registered earlier in the day on Tuesday, after the EGoM decided to defer the decision on MMTC stake sale.

At 01:10 pm, MMTC was trading 5.04 per cent higher at Rs 311.40. It has hit a 52-week low of Rs 280.25 and a high of Rs 318.85 in trade today.

“An inter-ministerial panel did not accept the banker’s recommendation on MMTC valuations,” ET Now reported.

“The disinvestment programme for PSUs, which has largely been on pace, has been hiked from Rs 40,000 crores this year to meet the more ambitious budget target of Rs 55,000 crore in fiscal 2014,” said A.K Prabhakar, Senior Vice President - Equity Research at Anand Rathi.

“The deferral news is positive for the stock as the government wants to price MMTC and other PSU stake sales on a more aggressive note to meet the divestment target,” he added.

Earlier, an inter-ministerial panel was likely to decide the floor price for 9.33 per cent stake sale in MMTC, which can fetch around Rs 300 crore to the exchequer at current rates.

Of its shareholding of 99.33 per cent in MMTC, the government is considering divesting 9.33 per cent paid-up equity share capital. The stake sale would also help the company meet the minimum 10 per cent public holding norms.