Modi govt flags off strategic PSU sell-off with Scooters India | business-news | Hindustan Times
Today in New Delhi, India
Jun 28, 2017-Wednesday
-°C
New Delhi
  • Humidity
    -
  • Wind
    -

Modi govt flags off strategic PSU sell-off with Scooters India

The strategic stake sale in Scooters India is part of the overall Rs 72,500-crore disinvestment target fixed by the finance ministry for 2017-18.

business Updated: May 10, 2017 13:14 IST
Raj Kumar Ray
disinvestment
File photo of finance minister Arun Jaitley speaking in Lok Sabha.(PTI)

The Narendra Modi government has flagged off outright sale of some of the state-owned firms starting with Scooters India.

The strategic stake sale in Scooters India is part of the overall Rs 72,500-crore disinvestment target fixed by the finance ministry for 2017-18.

The stake sale is likely to attract attention of major auto companies as the Lucknow-based company has an integrated automobile plant, engaged in designing, developing, manufacturing and marketing a broad spectrum of conventional and non-conventional fuel driven 3-wheelers.

“The government has in-principle decided to disinvest its 100% equity in Scooters India Ltd through strategic sale with transfer of management control,” the department of investment and public asset management (DIPAM) said in a statement late on Tuesday.

Scooters India was formed after the government bought over Innocenti of Italy. In 1975, the company started its commercial production of scooters under the brand name of Vijai Super for domestic market and Lambretta for overseas market.

After the NITI Aayog completed the process of identifying central public sector enterprises (CPSEs) for strategic disinvestment, the finance ministry has started the process of inviting bids from merchant bankers and legal advisers.

In April, the government kicked off the disinvestment process with a 9.2% stake sale in Nalco for Rs 1,204-crore. The government is also selling a 10.2% stake in Hudco to raise upto Rs 1,225 crore.

The finance ministry has also plans to sell stakes in more than 20 companies, including blue-chip companies such as Indian Oil Corp, National Thermal Power Corp, Rural Electrification Corp, Power Finance Corp, Neyvelli Lignite Corp and NHPC.

Apart from the seven blue-chip companies, the government also has plans for listing Rail Vikas Nigam Ltd, IRCON International Ltd, Indian Railway Finance Corporation Ltd, Indian Railway Catering and Tourism Corporation Ltd, RITES Ltd, Bharat Dynamics Ltd, Garden Reach Shipbuilders & Engineers Ltd, Mazagon Dock Shipbuilders Ltd (MDSL), North Eastern Electric Power Corp, MSTC Ltd and Mishra Dhatu Nigam Ltd.

Five state-owned insures—New India Assurance Company Ltd, United India Insurance Company Ltd, Oriental Insurance Company Ltd, National Insurance Company Ltd, and General Insurance Corporation of India—will also be listed.

The government has set a target of Rs 46,500 crore through small stake sales and Rs 15,000 crore from strategic disinvestment during 2017-18, to help bridge the fiscal deficit estimated at 3.2% of GDP during 2017-18.