BEML Land Assets, the demerged non-core business entity of defence public sector firm BEML Ltd., made a weak debut on the bourses on Wednesday, with the stock locked in a lower circuit on its first day of trade.
Shares of BEML Land Assets listed at Rs 290.20 on the BSE. In a volatile session, the stock first hit the 5 percent upper circuit of Rs 304.70 per share before dropping almost 10 percent from that level to hit the 5 percent lower circuit of Rs 275.70 on the BSE.
To recall, defence PSU BEML in October 2022 had demerged its non-core businesses into BEML Land Assets. The demerger was to specify the value of its core business (manufacturing of heavy equipment like earth movers and defence equipment) and fixed assets separately.
This would pave the way for the partial divestment of the government’s stake in BEML, which stood at 54.03 percent as of December 31, 2022. The government has already decided to sell 26 percent of the equity share capital of BEML through strategic disinvestment along with the transfer of management control.
As per the demerger proposal, BEML shareholders were supposed to receive shares in BEML Land Assets in the 1:1 ratio. This means that for every one share held in BEML Ltd., shareholders will be allotted one share of BEML Land Assets.
BEML Land Assets reportedly holds about 550 acres of land in Bengaluru and Mysore. According to analysts, the estimated value of the land assets of the company is around Rs 8,400 crore. This translates into an estimated land value of Rs 500-525 per share.
Shares of BEML Land Assets are trading 5 percent lower at Rs 275.70.
