PSU stocks are trading strong led Engineers India and Syndicate Bank. As per a leading daily, decision regarding divestment of Oil and Natural Gas Corporation Ltd. (ONGC) and Bharat Heavy Electricals (BHEL) has been deferred after a meeting of the empowered group of ministers. It was expected that the new Securities and Exchange Board of India (SEBI) guidelines might induce the government to start thinking about the divestment plans once again. We may note here that the government has raised Rs 11.45 bn so far of its Rs 400 bn divestment target. Even after discussing the implications of these guidelines, no decision was taken. However, the stake sale in ONGC would be completed to the extent of 5%. This could be done either through follow on public offer or the auction route.
Steel stocks are trading in the red led by Tata Steel and Jindal Steel. According to a leading financial daily, Steel Authority of India (SAIL) will re-invite quotations from mining contractors to develop a greenfield coking coal mine. Till now, the search for a mining contractor willing to run the 4 million tonne mine, coal washery and take on resettlement and rehabilitation of 3,500 families at the Tasra block, Jharkhand, at an affordable price has proven difficult. It will be the fourth time that the company is trying to find contractors for the project. To attract increased response, SAIL is also considering offering washed coal rejects to the selected contractor for use in power generation. This proposal will however have to be first cleared by the SAIL board before the tender is announced.