An Empowered Group of Ministers (EGoM) has given its nod for the follow-on public offer (FPO) of Engineers India Ltd (EIL). This will be the first FPO of a Central Public Sector Enterprise (CPSE) in the current fiscal where retail investors have a fixed quota of shares offered.

The Government has also confirmed that it is considering stake sale in BHEL through block deals to institutions while efforts are on to complete the residual stake sale in Hindustan Zinc before March 31.

The Government intends to divest 10 per cent of its 80.40 per cent holding in EIL. Sale of 3.36 crore shares at the current market price of ₹146.65 will fetch ₹492.7 crore. On Thursday, EIL shares dropped 2.23 per cent to close at ₹146.65 on the BSE.

After the EGoM meeting, Disinvestment Secretary Ravi Mathur, said: “We can give a definite timeline for the issue after we receive approval from the Registrar of Companies.” Five per cent of the total shares offered in the issue will be reserved for EIL employees, while a minimum 35 per cent will be kept for retail investors, whose bid size would be ₹2 lakh or less.

Five bankers — ICICI Securities, IDFC and Kotak Mahindra Capital, Edelweiss Financial Services and IDBI Capital — are managing the process. The EGoM nod has come more than a year after the Cabinet Committee on Economic Affairs approved the sale.

The Government plans to raise ₹40,000 crore by way of disinvestment and another ₹14,000 crore through residual stake sale in non-Government companies, such as Hindustan Zinc, Balco and Axis Bank during the current financial year. So far, it has raised only about ₹3,000 crore through PSU stake sales.

On BHEL, Mathur said, discussions are on to sell 5 per cent Government equity through block deals to financial institutions. This sale could bring in ₹1,300 crore to the Government. In the meantime, the Disinvestment Secretary said the disinvestment of 10 per cent stake in IndianOil will move further once the boards of ONGC and Oil India meet and approve the resolutions. “Once their resolutions are with us, then the EGoM will meet and decide the block deal,” he said.

On Hindustan Zinc, Mathur said once the approvals are in place, the department will go ahead with the appointment of bankers, valuations of shares and then in consultation with SEBI, a transparent auction process will be finalised. “Yes, it (Hindustan Zinc divestment) will happen this financial year, whatever is the residual stake,” he added.