The stock has underperformed the market due to concerns on mining volumes, delayed expansion, and lower realisations. However, now the volume outlook is improving with gains expected from FY14 onwards, given the ongoing capacity expansion.
Like its predecessors REC and NTPC, mining major NMDC, the third government-owned company to hit the markets this year, received tepid response on the first day of follow-on offer (FPO).
Public sector major NTPC's follow-on public offer (FPO) managed to scrape through today, but raised questions about the state of the primary markets and the government's disinvestment programme.
Another FPO, that of NMDC, is also likely to be held by end-this fiscal, the official said.
With the new owner shelling out Rs 18,000 crore for the buyout of 'Maharaja' this would be the highest ever amount garnered through privatisation or even the cumulative sum garnered through strategic sale in 1999-00 to 2003-04. The government had garnered roughly over Rs 5,000 crore during that five-year period by privatising 10 CPSEs.
After a hiatus of nearly two decades, the government's programme to privatise state-owned firms restarted with the handing over of debt-laden national carrier Air India to the Tata Group. With the new owner shelling out Rs 18,000 crore for the buyout of the 'Maharaja', this would be the highest-ever amount garnered through privatisation, and is even more than the cumulative sum mopped up through strategic sales from 1999-00 to 2003-04. The government had in October last year inked the share purchase agreement with the Tata Group for sale of national carrier Air India for Rs 18,000 crore. Tatas would pay Rs 2,700 crore cash and take over Rs 15,300 crore of the airline's debt.
When big offers hit the market, broader indices corrected 2-4%
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