Even as there has been no public offering during the first four months of 2012-13, the Finance Ministry, on Wednesday, exuded confidence on meeting the disinvestment target of Rs.30,000 crore set for the fiscal year as the modalities for sell-off of the Centre’s stake in public sector undertakings (PSUs) were being worked out.
Addressing journalists on the sidelines of a SCOPE event here, Disinvestment Secretary Mohammad Haleem Khan said: “Meeting of divestment target should not be a problem because we have enough [PSUs] in the pipeline, and our team is working on other cases also, so that necessary CCEA [Cabinet Committee on Economic Affairs] clearances are available in time”.
Mr. Khan stressed that the disinvestment exercise was a part of the economic reform process and should not be viewed as just a tool to raise resources and pointed out that the PSUs lined up for stake sale could hit the market at short notice after obtaining the nod from the CCEA.
For the current fiscal, the Department of Disinvestment (DoD) has about 15 state-owned undertakings in the pipeline for equity stake sale. Among them are a slew of blue chip companies such as BHEL, SAIL, RINL, Oil India and HAL. This apart, two other sell-off modes made available by market regulator SEBI (Securities and Exchange Board of India) since January this year are OFS (offer for sale) and IPP (Institutional Placement Programme) which can be put in motion when the stock market sentiment is not on a sustained bull phase.
In particular, these two stake sell-off tools can be utilised by listed companies to meet the minimum 25 per cent public shareholding norm, as stipulated by SEBI. While all listed private sector companies have to comply with the minimum public holding norm by June next year, the PSUs have an additional month till August 2013.
As of now, there are over a dozen listed public sector undertakings which have to meet the minimum public holding norm set by SEBI and several public sector undertakings have initiated the exercise to raise the public shareholding ratio. “Most of the companies that are supposed to meet free float norms, are already taking steps and they will be in the market in due course of time,” Mr. Khan said.