SCI found itself sailing ahead on Tuesday following a crucial divestment meet scheduled for Tuesday to decide on the modus operandi for the company's divestment.
Anticipatory buying took the scrip of the state-run shipper strongly ahead, by 4.47% to Rs 62 (by 10:10 IST). By then, the scrip of Shipping Corporation of India recorded volumes of 54,061 shares on BSE. Between 28 March and 11 April 2003, SCI rose 18.22% to Rs 59.35 from Rs 50.20.
A Cabinet Committee on Disinvestment meeting is being held today to discuss the relaxation of bidding norms for SCI. The move to liberalise bidding guidelines for SCI is aimed at attracting foreign shipping companies into the divestment process of the company.
Currently, only two companies are believed to have submitted initial bids for SCI. Foreign companies were put off by the government's 26% restriction on capital to be owned by the them in the company. The government plans to offload 51% stake in the company out of its 80% holding. 3% stake will be sold to the employees of SCI.
The government is also likely to decide on whether to proceed with the existing bidders or to invite fresh bids.
The scrip may have also been spurred on by reports that shipping companies are hiking freight rates to the US by around 35-40% in an attempt to make their services profitable.
SCI is India's leading shipping company. It operates in two segments - the liner segment and the bulk segment. The liner segment includes break-bulk and container transport. The bulk segment covers tankers (both crude and product), dry bulk carriers, gas carriers and phosphoric acid carriers. The government only recently approved the sale of SCI's 20% stake in its liquefied natural gas venture Greenfield Holding Company to Japanese partner Mitsui.
For the quarter ended 31 December 2002, the company's net profit more than doubled to Rs 76.22 crore on total income of Rs 614.16 crore (Rs 6.14 billion).
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