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Monday, August 27, 2007

Govt to sell fresh 4.75% stake in NTPC via FPO

The government plans to sell 4.75% of its stake in National Thermal Power Corporation (NTPC). The Ministry of Power has sought approval from the Department of Disinvestments for a follow-on public offer. NTPC has told the Ministry it will not be appropriate to increase the company’s equity base with a fresh issue as it already has the highest paid-up capital - Rs 8245.5 crore - among the country’s listed firms. NTPC feels any increase will reduce earnings per share.

Further, the projections made by NTPC for funding future capital expenditure needs indicate that the internal resources of the company are more than adequate.

With just a few high-quality issues arriving this year, the bourses will welcome this move. The NTPC stock closed at Rs 163.80 at the National Stock Exchange (NSE) on Friday, reports The Indian Express.

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