The government's latest offer for sale in Hindustan Copper Ltd. may be its last, with the Centre planning to reduce its stake to 60% and retain that holding to give the state-run miner room to raise capital for future investments, DIPAM Secretary Arunish Chawla said.
Chawla made the comments as the government began its sale of up to a 6% stake in Hindustan Copper through an offer for sale, with the floor price set at Rs 514 per share. The transaction would reduce the government's holding to about 60%, marking a potential end to further stake sales in the company for now.
"This may be the last OFS because we will now bring it down to 60% and then hold it there for its capital requirements," Chawla said in an interview with NDTV Profit.
No More OFS?
The latest transaction is the seventh offer for sale in Hindustan Copper since 2015, Chawla said.
The government wants to retain enough flexibility for the company to raise money from the market and fund investments in modern and technology-intensive mining, he said.
"We are leaving a little margin for the company to mobilise capital on the markets to be able to invest it in mining that is modern and technology-intensive and be able to use that margin for its capital investment and its sustained growth future," Chawla said.
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Growth Plans
Chawla said investors should assess Hindustan Copper's medium- and long-term prospects rather than focus only on quarterly performance.
"Hindustan Copper has good futuristic investment plans," he said. "It produces copper which is valuable for our economy, for our supply chains."
"We should not be driven by short-term quarterly profits," Chawla said. "We should look at what their medium-term performance is and what their long-term vision is."
The government offered 5.8 crore shares in the OFS, with 10% of the offer reserved for retail investors, Chawla said.
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