• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Our Bureau

MUMBAI, Oct. 1

NATIONAL Aluminium Company's (Nalco) stock price dipped sharply today on heavy selling from institutional investors on concern that the disinvestment of the company would be delayed, brokers said.

The stock ended 5.51 per cent down at Rs 84.90 on the BSE. On the NSE, Nalco closed at Rs 85, down 5.40 per cent. Trading volumes in the counter increased; on the BSE 2.22 lakh shares were traded compared with 55,071 shares traded on Monday. On the NSE, volumes increased from 2.90 lakh shares to 4.18 lakh shares. About 30 per cent traded shares were presented for delivery on the NSE and 32 per cent on the BSE.

The heavy selling was from institutional investors mainly on account of concern over the delay in the disinvestment of the Government stake.

"Most of the institutional investors had bought Nalco shares on hopes that the Government would dilute part of its stake in favour of a strategic investor. But political interference in the entire disinvestment process has led to selling in the counter", said a broker.

He said this had been the main reason for the stock to fall from Rs 115 to current levels in just a month.

The latest political trigger came from the Orissa Chief Minister, Mr Naveen Patnaik, who said in the State Assembly that he would continue his struggle against the privatisation of Nalco. The smelter and mines of Nalco are located in Orissa.

However, the Disinvestment Ministry officials claim that the disinvestment process of Nalco is on schedule. "Even though the Disinvestment Ministry has already received expressions of interest from various aluminium majors, market players are not convinced that the disinvestment in Nalco would be on schedule," said a broker with a leading domestic broking firm.

Brokers also feel that the stock price of Nalco will fall further in case the Government decides to sell its stake through IPO in the first stage. As per the Government plans, there would be a simultaneous disinvestment of Government stake through IPO and ADR followed by strategic sale.

Send this article to Friends by E-Mail
Comment on this article to BLFeedback@thehindu.co.in

Stories in this Section
Bears march ahead

Copyright © 2002, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line