Disinvestment in MMTC may not be possible in the immediate future as stock market conditions are not appropriate for fixing the price band of the thinly traded shares of the company, a top Commerce Ministry official said today.
“We are waiting for the right time. The current market condition is not good for disinvestment,” the official said.
Besides, “as MMTC’s shares are very thinly traded in the market, it is very difficult to fix the price band,” he added.
While its shares are thinly traded in the market, the floating stock is so limited that it does not reflect the true value of the company, the official said.
The central government, which holds 99.33 per cent stake in the trading firm, has plans to divest 10 per cent of its shares.
MMTC has received EGM approval for splitting each share of face value of Rs 10 into 10 scrips of Re 1 each and issuing one-to-one bonus shares.
Shares of MMTC were being quoted at Rs 831, down 1.84 per cent from previous close, in late afternoon trade on the BSE.
In the Budget 2011, the Government had envisaged to raise Rs 40,000 crore from disinvestment of its shares in the public sector enterprises, but has mopped up only Rs 1,145 crore till date amid volatile capital market situation.
In 2010-11, the Government had raised Rs 25,000 crore from disinvestment against the target of Rs 40,000 crore.