Shares of two state-owned mining companies NMDC and MOIL were trading lower by 1% each after the board of both companies on Tuesday approved buyback of 25% of their respective paid-up equity capital. The government holds 80% stake in both companies.
At 10:16 AM, NMDC was trading at Rs 91 and MOIL at Rs 241 on the BSE, as compared to 0.14% rise in the S&P BSE Sensex.
NMDC will buyback up to 991 million equity shares at a price of Rs 94 per share, while MOIL will buyback up to 42 million shares at a price of Rs 248 per equity share from the equity shareholders of the company, as on the record date, on a proportionate basis, through the tender offer.
The board of directors noted the intention of the promoters of the companies to participate in the proposed buyback.
In past four trading sessions, MOIL (up 10%) and NMDC (up 6%) had outperformed the market by gaining up to 10% after these companies announced the shares buyback plan. The benchmark index rose 1% between May 1 and May 7.