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The Finance Ministry on Saturday said 10 CPSEs, including THDCIL, RailTel and TCIL, have been lined up for initial public offerings (IPO) and plans are afoot to launch sector-specific ETFs to meet the ambitious Rs 90,000 crore disinvestment target for 2019-20.
Besides, the ministry plans to march ahead with the strategic disinvestment of a host of CPSEs and monetise non-core assets of state-owned companies, said Atanu Chakraborty, Secretary in the Department of Investment and Public Asset Management (DIPAM).
“We have about 10 IPOs, which are lined up already. Then there are lot of companies which have to meet their minimum public shareholding target. We will also bring new theme-based ETFs. Then there would be strategic disinvestments and post-elections we would top it up sharply and an asset monetisation framework will see the light of day next year,” Chakraborty told PTI in an interview.
The Interim Budget has set a target of Rs 90,000 crore to be mopped up from CPSE disinvestment in 2019-20, higher than the target of Rs 80,000 crore in the current fiscal.
In the 10 months of the current fiscal so far, Rs 36,000 crore has been raised through stake sale in CPSEs, as well as tranches of Exchange Traded Funds (ETFs) and share buybacks. The government has the uphill task of mopping up another Rs 44,000 crore from disinvestment by March-end.
“All transactions are in place to meet the Rs 80,000 crore target set for the current fiscal,” Chakraborty said.
The government is expected to raise around Rs 12,000 crore from share buyback offerings by CPSEs, including ONGC, Coal India and IOC. In addition, about Rs 15,000 crore would come in from PFC buying out government equity in REC.
Further, the strategic disinvestment of Pawan Hans is also expected to be completed by March 2019.
For the next fiscal beginning April, Chakraborty said DIPAM has prepared a blueprint to achieve the target of mopping up Rs 90,000 crore from disinvestment.
With ETFs emerging as the most viable route for offloading CPSE stake in the market, he said the department would conduct a study to provide a risk-free investment option to retail investors in the form of sector-specific ETFs.
The government has already floated two ETFs -- CPSE ETF and Bharat-22 ETF -- which have mopped up Rs 17,000 crore and Rs 8,325 crore respectively this fiscal.
“You should not see ETF as an individual share. In an ETF, we bring shares together to reduce the systemic risk,” he said, adding that DIPAM is looking at the possibility of forming a basket of shares from the same sector and design an index.
Chakraborty further said the government is also examining the possibility of listing the existing ETFs on overseas bourses.
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