After a gap of more than three years, the Centre will roll out initial public offers (IPOs) in PSUs once again with a 10% stake sale in Cochin Shipyard in October-November, a senior government official told FE.
Cochin Shipyard stake sale will be followed by listing of Indian Renewable Energy Development Agency Limited (IREDA) in the later part of the current fiscal. The IREDA stake sale would consist of 10% government equity disinvestment and 15% fresh equity to fund the company’s expansion plans.
While a 10% stake sale in Cochin Shipyard will fetch the government about `350 crore, the stake sale in IREDA could fetch it about `250 crore, the official said.
While the government is likely list the Housing and Urban Development Corporation this year, its plan for a 10% stake sale in an IPO in military plane-maker Hindustan Aeronautics Ltd (HAL) to raise about `3,000 crore has come up as a cropper due to reluctance of the plane maker and ministry of defence to share financial details of the company due to security reasons.
Even though there are apprehensions that market regulator Sebi may not approve HAL IPO without full disclosure financial details, the finance ministry officials are hopeful that the issue could be sorted out in due course. “Exemptions have been given to defence firms world-over from full public disclosure for listing. So, we hope HAL listing will happen at some point of time if not in the current fiscal year,” the official said.
As a precursor to the listing, the Centre had raised `4,200 crore by selling back a portion of its stake in HAL back to the company. The move was aimed at improving key financial ratios such as price-to-earnings, to make it more attractive for investors. HAL listing has been pending since 2011.
The last PSU IPO was in March 2012 when the government sold a 10% stake in National Buildings Construction Corporation to raise `125 crore. Choppy markets and lengthy processes, often resulted in shelving of listing of many PSUs thereafter.