PSU chiefs asked to shut up about selloff plans

NEW DELHI: It may be time for PSU brass and bureaucrats in ministries in charge of disinvestment-bound companies to clam up. The government has decided to issue a shut-up directive to restrain bureaucrats who have been talking the markets up and down.
The directive, likely to be issued by the Bureau of Public Enterprises, follows a Sebi alert which, interestingly, itself has caused many eyebrows to go up because of its selective outrage over bureaucratic garrulousness. While Sebi chief G N Bajpai has criticised PSU chiefs, it has omitted any mention of the volatility caused in the scrips of public sector banks by the utterances of finmin mandarins.
The issue which has been attracting attention by statement-induced movements in PSU scrips finally came up for discussion at the last meeting of the Cabinet committee on disinvestment. The matter was raised by the finance minister Jaswant Singh, and was soon adjudged to be serious enough to cause the participants to direct the Cabinet secretary to get instructions issued.
Broaching the issue, Mr Singh expressed concern, but did not venture as far as to mention the Sebi probe he ordered into the unusual movements of stocks of public sector banks. The findings of Sebi’s investigation have so far remained mired in secrecy.
The communication from Sebi is believed to have made specific mention of the July 1 interview of National Fertilisers’ CMD P S Grewal, with the CNBC-TV 18. The interview saw the NFL chief taking a dim view of the government’s efforts to get a good price for the PSU on offer. His utterances caused the NFL scrip to tumble from Rs 67.45 to Rs 56.05 — a fall of 17% — in a single day.
Besides, Mr Bajpai, it is learnt, also contended that Mr Grewal and other bureaucrats speaking in the same fashion, were infringing the Listing Agreement. The stipulation requires the all listed companies to inform the exchange of all developments that affect their stock price.