Government to divest 10 per cent equity in NALCO

The government is actively considering divestment of 10 per cent equity in National Aluminium Company Limited (NALCO) and has circulated a draft proposal to various ministries, including the ministry of mines, for their comments, minister of state for finance SS Palanimanickam said on Tuesday.

NALCO, a Navratna PSU under the ministry of mines, has a paid-up equity capital of Rs1,288.62 crore and declared an interim dividend of 18 per cent (Rs0.90 per share of Rs5 each), amounting to Rs231.95 crore for the financial year 2011-12.

Out of this, the government received Rs202.14 as its share of profit. The government's share of the dividend was presented through the National Electronic Clearing Service (NECS).

The government holds 87.15 per cent of NALCO's pid-up equity capital and a divestment of 10 per cent equity will bring down the government's holding in the public sector undertaking to 77.15 per cent.

NALCO, which started commercial operations in 1987, has been earning profits consistently and has been declaring dividends since 1992.

For the year 2010-11, the company had declared a total dividend of Rs257.72 crore. The company had earned a net profit of Rs1,069 crore during the year 2010-11. During the current financial year 2011-12 (up to December 2011), the company had earned a net profit of Rs567.40 crore. The 18 per cent interim dividend is being paid on an enlarged capital base after split and bonus issue last year.