Sesa Goa declines; Morgan Stanley upgrades it to overweight

Moneycontrol Bureau

Sesa Goa shares declined for the second consecutive session Friday, falling 5.9 percent intraday. The lock-in period pursuant to its merger with Sterlite Industries ended on Thursday. It was a top loser in the Nifty with a 4 percent fall in previous session after rising 50 percent in the past one month.

Nearly 210 crore equity shares of Sesa Goa are listed today on the back of merger. Out of which, more than 202 crore shares were issued amongst Sterlite Industries, Madras Aluminium Company, Sterlie Energy & Vedanta Aluminium. Over 7.23 crore shares were issued to Ekaterina after merger.

Sesa Goa completed its process of merger last month and accordingly trading in Sterlite Industries was stopped last week. The former replaced latter in the Sensex. Shareholders of Sterlite received three shares of Sesa Goa for every five shares held.

Also Read - Can use Goa's 8-10MT inventory once ban is lifted: Sesa Goa

Meanwhile, Morgan Stanley upgraded Sesa Goa to overweight from equalweight and raised price target to Rs 240 from Rs 154.

"The market seems to be appreciating the value that Sterlite brings to Sesa Goa post the planned merger, though this is yet to be reflected fully. Solid zinc assets, improving balco Balco power divisions, and possibility of minority consolidation are the key benefits from Sterlite for Sesa," Morgan Stanley report said.

At 09:58 hours IST, the stock was down 1.23 percent to Rs 176.65 on the Bombay Stock Exchange.