In what could bring in over ₹34,000 crore to the Exchequer, the government plans to sell stake in seven public sector units, including blue chip firms such as Oil India and Steel Authority of India.

Bids for merchant bankers

The Department of Investment and Public Asset Management has invited bids from merchant bankers and legal advisors for managing the follow-on public offers (FPOs).

The firms include four power sector PSUs and three State-run mining firms. According to the Request for Proposal, the government intends to sell 10 per cent stake each in NHPC, NTPC, Power Finance Corporation and Steel Authority of India.

Clearance for IPOs

It also plans to sell 3 per cent stake in Oil India and 5 per cent equity in Rural Electrification Corporation. The Centre also intends to offload 15 per cent equity in Neyveli Lignite Corporation.

These FPOs, which will take place through the offer-for-sale route, are in addition to initial public offers in 11 public sector units that were approved by the Cabinet Committee on Economic Affairs last week.

Government sources said that all stake-sales may not take place this fiscal. “It will depend on valuations and market conditions. Timing them too close to each other could also impact investor appetite,” said an official.

The Budget has set a divestment target of ₹72,500 crore for the current fiscal, of which ₹46,500 crore is expected from minority stake-sales.

The Centre currently holds 58.28 per cent stake in IOC, 69.74 per cent stake in NTPC, 75 per cent equity in SAIL and 74.50 per cent stake in NHPC. Besides, it holds 90 per cent in NLC, 67.80 per cent in PFC and 60.64 per cent in REC.

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