MMTC stake sale today,floor price set at Rs 60

However,the shares are being offered at a hefty discount of close to 72 per cent. The GoM has set the floor price at just Rs 60 a piece,as against the Rs 211.45 that the company scrip closed at on Wednesday at the BSE.

“Concerns over valuation have been dogging the issue. The company has very little market float and so we needed to make the issue attractive for investors,” a government official said,adding that investors are free to bid at higher prices. “This is just the cut-off price,” he pointed out.

MMTC currently has a public float of 0.67 per cent,with government holding in the state run trading giant at 99.33 per cent. The stake sale,which was originally slated to take place in March,was deferred on valuation concerns.

Analysts too believe that given the low public float,investors should consider it as an initial public offer. “Many people think that it is 72 per cent discount at market prices. But with the low public float of MMTC,the current market price has no relevance,” said Jagannadham Thunuguntla,equity head at SMC Capital.

The company reported a loss of Rs 70.62 crore in 2012-13. as against a profit of Rs 70.72 crore in 2011-12.