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Concor selloff faces hurdle

New Delhi, July 10: The divestment department’s bid to include Container Corporation of India (Concor) in the stake sale list is likely to meet with stiff resistance from the Indian Railways.

Sources said the railway ministry was not in favour of diluting its stake in Concor as the firm had enough funds and could perform better with public-private partnerships.

Bengal chief minister Mamata Banerjee in her capacity as the railway minister had opposed stake sale in rail companies.

She has indicated that the ministry will continue to be headed by a Trinamul Congress member with a cabinet rank, and it is unlikely that the new minister will go for a change in the divestment policy.

Concor managing director Anil K. Gupta said the selloff issue was being looked into by the railway ministry, and a decision was expected soon.

The government is considering paring its stake in the PSU to 58 per cent from 63 per cent, which can fetch Rs 700 crore based on current market prices.

Sources said any dilution of stake in firms under the railway ministry could ring alarm bells in Bengal and could be politically exploited by the Left, who were opposed to divestments in state-owned firms.

The company had a net profit of Rs 830 crore in 2010-11 against Rs 786 crore in the previous fiscal. The firm had posted a net profit of Rs 819 crore in 2008-09.

Analysts said the logistic firm’s profit had been stagnant in the past few years and its revenues had been hit by increasing competition from road transporters and private operators.

As part of the new growth strategy, Concor is looking at opportunities in Bangladesh and Sri Lanka and has entered into a strategic partnership agreement to develop rail infrastructure for container cargo with Krishnapatnam Port Company Limited.

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