“The 60-odd companies which we are tracking now, we hope a majority of these will come into our action plan for disinvestment over the next few years,” Disinvestment Secretary Sunil Mitra told private TV channel CNBC-TV18 in an interview.
On Steel Authority of India Limited (SAIL) he said, “... FPO (follow-on public offer) will happen next year ... they need to mobilise money. Their expansion programme is on hold from last year and they want to go forward with it.”
In addition to CIL, he said, the telecom giant Bharat Sanchar Nigam Limited (BSNL) could also come out with its maiden public issue in the next fiscal. The government would come out with a detailed action plan for offloading its stake in PSUs by March, he said, adding the strategy would be to ensure maximum returns for the government and bigger retail participation.
In the current fiscal the government will offload equity of five major public sector undertakings — NTPC, Rural Electrification Corporation, Engineers India Limited, NMDC and Satluj Jal Vidyut Nigam Limited, he said. Even as four of the five disinvestments planned in the current fiscal are FPOs, Mitra said the government’s priority remains listing-led disinvestment. On whether the government would prefer FPOs of blue-chip state-run companies over IPOs, he said, “It’s not our intention to look for the low hanging fruits only.
“We would attach due credence and priority to the objective of this exercise, which is to unlock greater shareholder value and therefore get more and more IPOs out,” he said. However, he added, “Only how this sequencing will happen is something that will play out over the next couple of months and we should be far more definitive about this around March.”
The Government plans to divest stakes in NTPC, REC, NMDC and Satluj Jal Vidyut Nigam by March end, which will together fetch around Rs 30,000 crore to the exchequer.
The Cabinet had earlier asked all listed profitable CPSUs to have public holding of at least 10 per cent in them. It had also asked profitable unlisted PSUs to hit the capital market. This makes around 60 PSUs eligible for disinvestment.
The listed CPSUs that are making profits and have public holding of under 10 per cent include trading firm MMTC, mining major NMDC, Neyveli Lignite Corporation, Engineers India, State Trading Corporation, Rashtriya Chemicals and Fertilisers, National Fertilisers and Andrew Yule.