Steel sector trading firm MSTC Limited, a mini ratna under the Ministry of Steel, has filed a draft red herring prospectus with the Securities and Exchange Board of India (SEBI) on January 31 for an initial public offering (IPO) and is set to become the first PSU to take the IPO route in 2019. The government aims to dilute its stake in the company by selling 1.76 crore equity shares, representing 25 per cent of total paid-up equity, through offer for sale.
The Kolkata-based company is engaged in providing e-commerce related services across diversified industry segments offering e-auctions or e-sale and development of customised solutions. It is also a major player in the trading of bulk raw material. For MSTC, trading and e-commerce activities from government and government-controlled entities comprise 90 per cent of revenues.
To explore new opportunities, the company has laid down a plan to expand customer base and diversify into the B2C segment by creating a platform for retail players. “We are considering onboarding private sector clients and improve the mix of both government and private clients. We intend to offer the solutions which we have developed for our PSU clients to other companies in the private sector,” MSTC said.
Recently, MSTC developed an online price discovery platform for the export and import activities of Indian Oil Corporation Limited. “One of the main problems faced by these petroleum companies is the lack of a well-functioning, market-determined price discovery system. Our online platform serves to remedy this and the modules are the first of their kind in India. Given the success of this module with one of the leading petroleum companies, we will market this solution to other petroleum companies,” the company said. It also gearing up to take up e-commerce enabled trading business.
Online trading biz
MSTC is also planning to take up the e-commerce enabled trading business. “This will be a less risky business... and provide for better price discovery, transparent transactions and global reach,” it said.