March 22 (Bloomberg) -- Steel Authority of India Ltd., India’s biggest state-run maker of the alloy, received demand for more shares than offered by the government, which set a price last seen more than four years ago.
The one-day sale of stock, the second-worst performer on the BSE India Metal Index in the past year, got bids for 241.3 million shares as of 3:30 p.m. close, compared with the 240.4 million for sale, according to the BSE Ltd website. The government, which owns almost 86 percent of the New Delhi-based company, yesterday set a minimum price of 63 rupees to sell a 5.82 percent stake.
The shares extended six-day fall, declining 0.9 percent to 63.35 rupees, the lowest price since Nov. 24, 2008.
Government asset sales at discounted prices have eroded stock values, as Prime Minister Manmohan Singh’s administration seeks to bridge the widest budget deficit among the biggest emerging economies. India plans to raise 240 billion rupees ($4.4 billion) from asset sales this fiscal year to help pay for subsidies and investments in public welfare.
The share is expensively priced even at 63 rupees, Angel Broking Ltd. analyst Bhavesh Chauhan said in a client note today, recommending they avoid buying the shares.
The minimum price for shares in NTPC Ltd., India’s biggest utility, was set at 145 rupees on Feb. 6, the day the stock closed at 151.80 rupees. National Aluminium Co. shares were sold at minimum of 40 rupees apiece. The stock of the light-weight metal producer plunged 8.5 percent to 40.35 rupees, the lowest price since November 2008 that day.
Steel Authority’s share sale, first planned for the year ending March 31, 2011 was deferred because of a declining equity market. The stock ended at 160.96 rupees on March 31.
Finance Minister Palaniappan Chidambaram last month trimmed the nation’s share sale target by 20 percent to 240 billion rupees for the year ending March 31. India has sold shares in companies including NTPC, National Aluminium, iron ore miner NMDC Ltd. and oil explorer Oil India Ltd. this fiscal year.
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