Government Confident of Completing Hindustan Copper Stake Sale
The Indian government is confident that it will sell its entire 6% stake in Hindustan Copper, including a potential 3% greenshoe option, which would see its holding in the company fall from around 66% to 60%. Arunish Chawla, Secretary of the Department of Investment and Public Asset Management (DIPAM), said that metal prices are rising, making it an opportune time for the stake sale.
The government has put 5.8 crore shares on offer under the offer for sale (OFS) and is leaving room for Hindustan Copper to raise capital in the market and fund its expansion plans. Chawla noted that the company has 'very far-sighted capital investment plans' to expand and modernise its mining operations.
The government's stake reduction is part of a broader capital-management approach, which balances stake sales with the company's future investment requirements. DIPAM also requires public sector undertakings (PSUs) to maintain a fair dividend policy, with 30% of profit after tax or 4% of net worth, whichever is higher, to be shared with investors.