Calcutta, May 3: The Andhra Pradesh government will divest its entire 4.7 per cent stake in CK Birla group company Hyderabad Industries Ltd through competitive bidding.

The share price of the asbestos and building products company increased 14 per cent to Rs 476 today ? the last day for registration of buyers for the stake. The price ruled around Rs 418 on April 24, the day the government announced its desire to divest its holding.

CK Birla group companies, including Orient Industries, Central India Industries, Hindustan Motors and few investment firms, own 42.87 per cent in Hyderabad Industries.

The group is likely to be a strong bidder to strengthen its holding, sources said.

The Andhra Pradesh government will sell the 3,05,552 shares of Hyderabad Industries in a single lot.

The non-promoters, including banks and financial institutions along with the state government, hold 25.20 per cent in Hyderabad Industries.

The non-promoters’ holding would reduce to 20.9 per cent if the CK Birla group manages to corner the shares on sale.

While a 22.28 per cent stake belongs to the public, private corporate bodies own 7.05 per cent and non-resident Indians and overseas corporate bodies together hold 2.48 per cent.

Stock market operators feel the CK Birla group is a natural bidder for the government’s stake.

The promoters had been trying to buy out the government’s stake at a negotiated price. But the competitive bidding process had to be initiated to bring about transparency in the transaction, sources said.

In such a situation, other stakeholders and market players are unlikely to sit idle and instead will push up the stock price.

The selloff process will be completed by the end of this month.

Besides Hyderabad, the company has manufacturing units at Dharuhera, Faridabad, Jasidih, Thimmapur, Tiruvallur, Vijaywada and Wada.

Hyderabad Industries has grossed Rs 428 crore during 2005-06 against Rs 407.5 crore in the previous year.

It makes fibre cement corrugated and plain sheets, autoclaved aerated concrete blocks, insulating roof tiles, joining material for automobile gaskets, plant and machine cement products and prefab structures.