Pitching for listing of state-owned companies on the bourses, Board for Reconstruction of Public Sector Enterprises (BRPSE) Chairman Nitish Sengupta on Monday maintained that the actual valuations of such entities come to light only when they are traded on the stock exchanges.
In an interaction with the media here, Dr. Sengupta sought to drive home the point that partial divestment of PSEs for listing purposes stand the companies in good stead and, therefore, should never be opposed. “Only when shares [of PSEs] are listed, people will come to know what a great company it is. One should never oppose such listings,” he said.
Citing a specific example, the BRPSE chief referred to the likely initial public offering of Coal India Ltd. (CIL) some time later this year, which is being opposed by the Left trade unions. CIL “will be in the list of Fortune 500 the day it is listed on the stock exchange…If 10 per cent shares of Coal India are listed tomorrow, within a day it will be in the list of fortune 500 companies,” he said.
Dr. Sengupta emphasised that BRPSE favoured listing of all PSEs and allayed apprehensions on government losing control on them. “People should know that the government is not giving up control of the company. Only some shares are sold for listing purposes,” he said.
Out of the top 10 companies (by market capitalisation) on the Bombay Stock Exchange (BSE), five are PSEs.
As for the Fortune 500 list, which ranks the world's largest companies on the basis of annual revenues, eight Indian companies feature in the list, including the state-owned oil major Indian Oil Corporation.
Dr. Sengupta noted that since the beginning of the 21st century, PSEs have shown “remarkable capacity” for increasing both production and profit.
