Government likely to approve stake sale in 5 PSUs, IPO of RITES

NEW DELHI: Hard pressed to achieve disinvestment target of Rs 30,000 crore in the current fiscal, the government will consider the proposal of stake sale in five state-owned companies including Hindustan Copper, Oil India and Nalco.

Besides stake sale, the Cabinet Committee on Economic Affairs (CCEA) in its meeting tomorrow, will also consider initial public offering (IPO) in the Rail India Technical and Economical Services (RITES).

The agenda of the CCEA, according to sources, also include stake sale in Neyveli Lignite and MMTC.

The Department of Disinvestment (DoD), they said, has proposed 10 per cent stake sale proposal of Oil India and another 9.59 per cent disinvestment of Hindustan Copper.

Further, a 5 per cent stake sale of Neyveli Lignite and 12.15 per cent in Nalco through Offer for Sale (OFS) route is being proposed.

In case of MMTC, the DoD has proposed 9.33 per cent stake sale.

The DoD has already invited expression of interest from merchant bankers for managing these issues.

Finance Minister P Chidambaram has already asked officials to expedite the process of disinvestment so that state-owned companies could hit stock markets in time and help the government achieve the target of Rs 30,000 crore in the current fiscal.

Although five months have passed in the current fiscal, the government has not been able to come out with a single public issue.

Raising adequate funds from disinvestment was necessary to keep in check the fiscal deficit which is facing pressure due to rising food, fuel and fertiliser subsidy bill.

The government earlier deferred the initial public offer (IPO) of Rashtriya Ispat Nigam Ltd (RINL) due to weak stock market conditions. The Rs 2,500-crore RINL issue was originally proposed to hit the markets in July.

Due to uncertain market conditions, the government in the last fiscal raised only Rs 14,000 crore from disinvestment against the target of Rs 40,000 crore.