The Cabinet committee on Economic Affairs (CCEA) gave an approval for divesting 26 percent equity shares in BEML India out of the government shareholding 54.03 percent. Following the stake sale news, the BEML stock was trading at Rs 1,135 at around 11:25 a.m. on Monday, up 14.26 percent from its previous close on the Bombay Stock Exchange.
The announcement of the stake sale was made after trading hours on Friday, January 6. The Bengaluru-based BEML company has an equity capital of Rs 41.64 crore.
"Ministry of Defence has communicated 'in-principal' approval of the Cabinet Committee on Economic Affairs (CCEA) of the Government of India, for strategic divestment of 26% equity shares in BEML Limited out of Government of India shareholding of 54.03%. The said shareholding would be sold to strategic buyer/s, to be identified by the Government of India by following due procedure," the company said in a regulatory filing to the BSE.
Post the divestment, the government's shareholding in the defence ministry company will be down to 28 percent. The stake sale is expected to realise about Rs 1,000 crore for the government.
For the financial year 2015-16, the company's sales stood at Rs 3,426 crore, while the order book position as of November 30, 2016 was Rs 7,261 crore.
Mutual Funds hold 18.64 percent, while retail shareholding is about 10 percent in BEML.
The BSE Sensex was marginally down and trading at 26,746 while the NSE Nifty was flat 8,244. Dr Reddy's Labs was the top Sensex loser, down 2.77 percent to Rs 3,073.