Stake-sale a hit; accruals to fund expansion: Hind Copper

The government has managed to rake in over Rs 800 crore with the divestment of Hindustan Copper with the help of LIC and some public sector banks. Around 3.7 crore shares were sold at an average price of Rs 156.8 per share.

The government got bids for over 5 crore shares. Divestment secretary Haleem Khan expressed satisfaction over the sale of stake. "We offered the market 4 percent and we got a bid for 5.59 percent. So, I don't think it can be considered as a failure. I think it should be considered a success keeping in view market conditions."
 
Finance minister P Chidambaram is also happy with the successful sale of stake in Hindustan Copper. Chidambaram told CNBC-TV18 that he is confident that the Rs 30,000-crore divestment target will be met. "I am happy that the issue has been fully subscribed. This is the resumption of the disinvestment process and we will go forward with disinvestment as approved by the CCEA betwen now and March and I hope that we can collect the targetted Rs 30,000 crore."

In an interview with CNBC-TV18, Hindustan Copper chairman and managing director KD Diwan explains that the sale of stake was successful and that the PSU would fund all its expansion plans through internal accruals.

Below is an edited transcript of the interview on CNBC-TV18

Q: Do you have any information on the likely investors who participated in the auction?

A: No. We are yet to receive the full details of the auction.

Q: Do the participants include foreign financial institutions also?

A: FIIs have not participated because they were not invited. According to the information available with me, domestic financial institutions such as GIC and LIC might have participated, but we will be able to confirm only when to receive the full details of the auctuion.

Q: What happens to the balance 5.59 percent? The government plans offer a second tranche? Have you been given any clarity on when the second tranche is likely to be auctioned?

A: The Sebi guidelines mandate that we can go to the market within a period of 15 days. So, the call will be taken by the government at the appropriate time.

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