Eight PSUs likely to hit market in Q3: MH Khan
As part of the government's disinvestment plans, around eight public sector companies are likely to hit the capital market in the October-December period, a top official has said.business Updated: Sep 11, 2012 20:13 IST
As part of the government's disinvestment plans, around eight public sector companies are likely to hit the capital market in the October-December period, a top official has said.
Bhel, SAIL, Hindustan Copper, Nalco, NMDC, NTPC, Neyveli Lignite and RINL are lined up for disinvestment in the next quarter, disinvestment secretary MH Khan said.
"We have taken a broad decision that in this third quarter we have to do so many things... I think, there are decent numbers... seven or eight companies are lined up and they are at various level of preparations," Khan told PTI on the sidelines of a workshop on ETF in Mumbai on Monday evening.
Though all these PSUs are lined up for stake sale, whichever is ready first will hit the market, he said, adding, it will be difficult to predict which company will hit the market first as it depends on many factors.
Through the disinvestment process, the government will offload at least 5% of its holding in these companies.
Referring to the timeline for NMDC and Nalco stake sale in particular, in which the Department of Disinvestment has already started the process, Khan said, "I think, that should be in the third quarter. But, then there are certain procedural issues. Unless there are some serious derailment of the procedure, I think that should be in the third quarter".
Earlier in September, the department had invited bids from merchant bankers for stake sale in two navratna companies - NMDC and Nalco.
Referring to stake sale in Oil India, Khan said, "They have already started the procedure. As soon as the authorisations are in place, it will go ahead".
The government has proposed to raise Rs 30,000 crore from disinvestment in this fiscal. However, it has failed to come out with any public offering so far.
Last fiscal, the government missed its disinvestment target of Rs 40,000 crore due to volatile market conditions and managed to raise only Rs 14,000 crore of which over Rs 12,000 crore was collected from selling 5 per cent in ONGC.
However, Khan said the Centre is hopeful of meeting the budgeted target of Rs 30,000 crore from disinvestment in the current financial year.
"In every market condition, the investor is willing to enter provided you price it proper. If we are able to price it properly, then investors will be there," he added.
About the kind of instruments that will be used for stake sale, Khan said offer for sale (OFS) would be the preferred instrument.
"Normally, we will do OFS if it is technically and legally possible. If for some reasons, it is technically or legally not possible, then we will go for the alternatives under the Sebi regulations," he said, adding that pricing of shares will depend on the market condition.