Disinvestment of 10 million shares of the Container Corporation of India (Concor) is to begin within ten days. "We are going ahead with the disinvestment of Concor," Sinha told reporters here after a 90-minute long meeting of the cabinet committee on disinvestment. Following the initial sale of ten million shares, another million shares will be divested to retail investors -- this is likely to take place after another six to eight weeks.

Though Sinha refused to comment on the time frame or the pricing of the issue saying that the details are still being worked out, top finance ministry officials said the process will begin in 10 days.

Investment bankers expect the price to be around Rs 260. Though the expected price is well short of the ruling market price of Concor, investment bankers feel it'sa fair enough price considering the dismal conditions in the capital market. "There were only Rs 110 crore worth of new issues this year which has witnessed a dramatic fall in market capitalisation. Even the Reliance scrip went below Rs 100 on Tuesday. The Government has finally taken a pragmatic stand", top investment banking sources said.

Besides, they added, with the overall slowdown in the economy and the fall in corporate profitability, Concor's expected profits were also expected to go down in the coming year. In which case, the expected price of around Rs 260 or so will not really be a discounted price, or a distress sale of Concor's shares.

The decision to go ahead with Concor disinvestment is in tune with finance minister Yashwant Sinha's repeated assertions that the PSU sell-off will take place on schedule irrespective of the market conditions.

Concor which proposes to tap the markets with a global depository receipts issue and a domestic offering has already received the go-ahead to build acommon book for the concurrent twin offerings based on the response received.Six million shares of Concor are to be divested through the GDR route and four million for the domestic market. The government has also decided to issue two million fresh shares along with the oversubscription option.

Concor would become the first public sector undertaking to carry out disinvestment this year. The other PSUs which are on the disinvestment list include Indian Oil, Videsh Sanchar Nigam and Gas Authority of India.

Investment bankers however feel that except Concor, disinvestment in the three others are set to be pushed into the next calendar year.

Of the Rs 64.9 crore Concor equity, the government holds 77.7 per cent while the balance is held by the public and the FIs. This includes the foreign holding of nearly 15 per cent with a large chunk being held by Morgan Stanley Growth Fund. Following the divestment, the government holding will come down to 51 per cent.

Investment bankers said the move would now be toensure liquidity for which a large enough investor base would be created. Investors should not be stuck with the shares and it is critical to ensure tradability, the sources said.The cabinet committee meeting was also attended by railway minister Nitish Kumar and industry minister Sikander Bakht. Nitish Kumar said though the capital market was down, the committee decided to move forward with the earlier cabinet decision to sell a portion of Concor shares.