BEML's stock gains may disappear

Stake sale decision helps stock rise 16% on Monday, but there remains little hope for rerating

At the close of last week's trade, market got reassurance on government's plans to sell 26% stake in BEML, that could fetch Rs 1,000 crore and reduce state stake to 28%. Usually, divestments and news of divestments tend to pressure stock price as shares may get sold at a discount to their market rate. But, Monday turned out rather unusual, with BEML, previously known as Bharat Earth Movers Limited, gaining 16.5%. In fact, the day saw public sector undertakings MMTC, Balmer Lawrie, Rashtriya Chemicals and Fertilizers Limited, and Hindustan Copper, rally 4-11.5% on hopes the government would take similar decisions