Shares of sick PSUs under pressure; MTNL tanks 19%

HMT, ITI and Hindustan Organic Chemicals were down 7% to 12% on BSE.

Shares of select public sector undertakings (PSU) companies were under pressure and falling by up to 19% on the bourses.

Mahanagar Telephone Nigam Limited (MTNL), HMT, ITI and Hindustan Organic Chemicals have dipped between 7-19% on the National Stock Exchange (NSE).

Among the individual stocks, state-run telecom company MTNL has tanked 19% to Rs 20.95 on NSE, after the company joined the list of sick central public sector enterprises (CPSEs).

MTNL, once market leader in mobile telephony sector, was declared sick as per the criteria for a PSU to be declared as such, after the company incurred losses worth 50% or more of their average net worth during four preceding years, the PTI reports suggests.

The counter has seen huge trading volumes with a combined 15.23 million shares changed hands till 1511 hours against an average sub 2 million shares that were traded daily in past two weeks on NSE and BSE.

Shares of HMT dipped 12% to Rs 48.10 after media report suggests that the company’s three units — two in Karnataka and one in Andhra Pradesh — are among the five sick CPSEs which the Union Government has decided to close down.

Heavy Industries Minister Anant Geete said during Question Hour in Lok Sabha on Tuesday said that the five state-run organisations to be closed down include three HMT units, whose brand of watches and tractors once ruled the market, added report.

Among the other stocks, ITI was down 9% to Rs 23.95 on BSE, followed by Hindustan Organic Chemicals (down 7% to Rs 15), Hindustan Fluorocarbons (down 2% at Rs 6.90).