Govt approves 10% stake sale in HUDCO

NEW DELHI: The government will sell a 10% stake in state-controlled Housing & Urban Development Corp Ltd (HUDCO) through an initial public offering (IPO), telecom

NEW DELHI: The government will sell a 10% stake in state-controlled Housing & Urban Development Corp Ltd (HUDCO) through an initial public offering (IPO), telecom minister Ravi Shankar Prasad said on Wednesday after a Cabinet meeting.

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The Cabinet committee of Economic Affairs (CCEA) also approved allowing a price discount of up to 5% on the issue price to retail investors and HUDCO employees.

The paid-up equity capital of HUDCO, with a net worth of Rs 7,800 crore, is Rs 2,001.90 crore as of March 31, 2015. The face value of each HUDCO share is currently around Rs 10.

The government wants to raise Rs 56,500 crore from the sale of stakes in public sector units in 2016-17, which is 19% lower than last year’s target, which the government failed to hit.

It has already kickstarted the disinvestment programme for the current fiscal (2016-17) with 11.36% stake sale in NHPC, which fetched the exchequer around Rs 2,700 crore.