GAIL India shares sank to a 17-month low

Shares of GAIL India Ltd., the nation's top transporter of gas, sunk to their lowest level in 17 months on news that the government had finalized plans to sell a minority stake in the company to meet expenses.

The government intends to raise up to 1,800 crore rupees through divesting a 5 percent stake in the public sector gas transporter in a bid to meet its fiscal deficit. As a consequence, the Finance Ministry has already cleared a draft cabinet note for inter-ministerial consultations to kick start that sale.

GAIL fell 3.4 percent, or 10.90 rupees, to 339 rupees, its lowest since March 2014, on the National Stock Exchange. Its contract volumes surged 128 percent to 3,854 contracts and Open Interest rose 11.2 percent. Both indicated a build up of short positions on the counter.

GAIL's market capitalization has eroded 19 percent to 43,820 crore rupees in the past one year as investors mostly exited PSU stocks in favour of their private sector peers.

(Image credits: Indiatimes)