Centre to disinvest 73 per cent equity in Dredging Corporation of India

Visakhapatnam: With a proposal to sell stake in Dredging Corporation of India (DCI), the Union government will hold a pre-bid meeting in New Delhi on Thursday.  It has recently issued a proposal to engage an asset valuer for disinvestment of the public sector unit. In Thursday meeting, it will clarify the queries raised by the bidders. As per the document issued by the Union shipping ministry, the government is considering to disinvest its 73.47 per cent paid-up equity capital in DCI through strategic sale with transfer of management control.

The DCI employees, who have been protesting against disinvestment for the last one month, said that the Central government plans to sell its stake to private firm at around Rs 1,700 crore considering the current market price of about Rs 682 a share. This will be a lucrative deal for the buyer as the dredgers of the company alone would cost more than Rs 8,000 crore, according to DCI Officers Association president B. Hanuma Naik.

The BSE-listed company has 23 dredgers, including three new dredgers purchased from a Netherlands-based company IHC in 2014, at a cost of Rs 1,620 crore. Even after depreciation, the value of these dredgers would be around Rs 8,000 crore, he claimed. The DCI is mainly involved in dredging, beach nourishment, land reclamation and marine construction. It has own office buildings at New Delhi and Visakhapatnam. It also has project offices and residential flats in different cities along with an under construction building in 1.1-acre in Vizag.

The company has 474 full-time employees, 1,035 contract workers and 332 trainees at present. It has a paid-up capital of Rs 28 crore and has about 46,000 shareholders. The current day share price in the market is about Rs 682 per share of Rs 10 each. Whenever there is a disturbance in a BSE-listed firm, the share price comes down. Conversely, the share price of DCI has increased to Rs 682 on Wednesday from Rs 640 on October 15. This is mainly due to the dredging operations being not effected and speculation on privatisation.

Though the company had been a profit-making firm right from its inception, it has been losing the tenders.  of dredging works due to the involvement of the ruling party. Last year, it has lost the dredging work of Kandla Port to a private firm with a difference of just '90 on the quotation price, DCI Non-Executive Employees’ Union working president P. Venkata Rao informed.