The share price of BEML surged over 15 percent on Monday to hit a 52-week high on media reports that at least 6 companies are looking to buy a stake in the defence equipment maker.
Companies including Tata Motors, Mahindra and Mahindra and Ashok Leyland are looking to buy a 26 percent stake in the state-run company, Mint reported. It added that Bharat Forge Ltd and Megha Engineering and Infrastructure Ltd may also submit expressions of interest for the government’s stake in BEML.
The stock rose as much as 15.4 percent to hit its 52-week high of Rs 1,353.35 per share on the BSE.
The report noted that these companies are looking to seek control of BEML as part of their strategy to grow their defence manufacturing businesses and cut dependence on the core commercial vehicle business, which is cyclical in nature.
The government currently holds a 54 percent stake in BEML and had invited expressions of interest for the strategic sale of 26 percent of the equity stake in the firm on January 4. The centre will also transfer management control to the buyer.
The Department of Investment and Public Asset Management (DIPAM) initially set March 1 as the deadline for submission of interest but later extended it to March 22.
SBI Capital Markets Ltd is advising the government on the sale process.
The stake sales in BEML will help bolster the government’s efforts to raise funds via asset sales for the next fiscal year.
The government hopes to generate Rs 1.75 lakh crore from disinvestment receipts in the coming fiscal.