SAIL marginally down after OFS issue opens

Moneycontrol Bureau

SAIL shares are marginally down after its offer-for-sale (OFS) issue  opened at 9:15 am today. The floor price of the issue is fixed at Rs 63/share and the government will divest over 5 percent stake in the company to mop up around Rs 1,500 crore. The remaining 5 percent will be auctioned in FY14.

Experts say that a grim business environment due to muted steel demand has prompted investors to stay away from the stock for quite sometime. SAIL shares have tumbled over 30 percent in past one year due to a sluggish demand-supply scenario along with cost overruns on important projects.

However, the company is nearing its Rs 70,000 crore expansion later this year and this could help the stock gain momentum. The stock is trading at an all-time low due to adverse market conditions. Going ahead, steel demand is expected to pick up and  coking coal price may also soften, leading to a correction in stock price.

SAIL shares are down  0.55 percent to Rs 63.55

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