Home Business NMDC plunges 20% amid divestiture of its steel business

NMDC plunges 20% amid divestiture of its steel business

NMDC shares hit their 52-week low of ₹92.25. (Representative)

New Delhi:

Shares of NMDC Ltd fell nearly 20 per cent to a 52-week low of Rs 92.25 on Thursday. Shares gained some stability as the day traded higher and closed at ₹104.60 after falling close to ₹26 per share from Tuesday’s closing figure.

The fall in the share price of NMDC comes in the backdrop of the company demerger of its steel business. The Ministry of Corporate Affairs (MCA) had earlier this month given green signal for the demerger of the 3 million steel plant at NMDC Steel, Chhattisgarh, from the state-owned iron ore minor.

NMDC has fixed Friday, October 28 as the record date for identifying the shareholders of the amalgamated company, who will be allotted shares of the new entity. Investors holding shares of NMDC Limited as on the record date will be eligible for shares of the new entity.

The shareholders of NMDC will be eligible to receive one share of NMDC Steel for every equity share held. However, this scheme will not be applicable for shares purchased after Tuesday, October 25. Shares of NMDC closed with some recovery on Tuesday, falling over 2 per cent at Rs 130.95 per share.

The state-owned miner will list its steel arm, NDMC Steel, on stock exchanges after obtaining requisite approvals. In-principle approval for demerger and disinvestment in the steel unit was given in October 2020 by the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi.

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