EIL disinvestment may happen in second half of July: Govt
Disinvestment Secretary Sumit Bose said that the government is likely to sell its stake in state-run consultancy firm Engineers India in the second half of July.business Updated: May 30, 2010 12:39 IST
Disinvestment Secretary Sumit Bose on Sunday said that the government is likely to sell its stake in state-run consultancy firm Engineers India in the second half of July.
"EIL's disinvestment is likely to happen in the second half of July," Bose told PTI in an interview. After SJVNL, EIL would be the second company in the current fiscal to do so.
The first stake sale in this fiscal -- SJVNL -- got a good response from investors, raising over Rs 1,000 crore.
The government has already appointed HSBC Holdings Plc, ICICI Securities, SBI Capital Markets and IDFC Capital to manage the follow-on public offer of EIL. Besides this, Luthra and Luthra have been appointed as the legal advisor.
At the current market price, the government is expected to raise about Rs 1,100-1,200 crore through the sale of 10 per cent stake in EIL, which provides design and engineering services for petroleum, power and fertiliser companies.
He further said that a number of companies, including EIL, MMTC, SAIL, Coal India and RINL, are likely to be disinvested in the current fiscal. This move would help it garner Rs 40,000 crore, as estimated in the budget.
"...We are working towards that figure (Rs 40,000 crore). We are looking at Hindustan Copper, Power Grid, Shipping Corporation...MMTC is under consideration. We are looking at Manganese Ore India also," Bose added.
He said that RINL would have to list itself within two years as part of the conditions for grant of the Maharatna status. The department of disinvestment has written to the steel ministry in this regard.
Besides this, the government would also offload its stake in Coal India and SAIL.
Last fiscal, the government had raised Rs 25,000 crore through stake sale in PSUs like Oil India, NMDC, REC and NTPC.
The Budget upped the revenue target from the sale of government equity in CPSUs to Rs 40,000 crore in 2010-11.
"The Rs 40,000-crore disinvestment target for the current fiscal is on track," Bose said.
As per a Cabinet decision, all listed profitable PSUs should have a public holding of at least 10 per cent, and all profitable unlisted CPSUs should be listed. As many as 60 state-run companies are eligible for disinvestment as per this criteria.