Sources say the EGoM is likely to meet again as not all the modalities have been finalised.
“We are working on the modalities. We cannot comment on anything till we file a prospectus with Securities and Exchange Board of India (SEBI),” disinvestment secretary Ravi Mathur said after the EGoM.
Mathur said that an agreement had yet to be signed with the asset management company Goldman Sachs for the ETF, adding that the disinvestment department will have to seek the election commission’s consent.
The ETF will comprise shares of ONGC, Coal India, GAIL, REC, Oil India, Container Corp, Power Finance Corp, Indian Oil, Engineers India and Bharat Electronics. The Centre had also added PowerGrid in the basket, but withdrew it as a 17% stake sale in the company had already taken place this fiscal. The government hopes to raise R3,000 crore through the ETF, which it will hope to add to its revised divestment target of R16,027 crore.
To ensure that the ETF issue succeeds, the finance ministry is proposing to give a reservation of about 25-30% to sovereign wealth funds. These funds will come in as anchor investors and act as a catalyst for other investors. The Centre also plans to provide a ‘loyalty bonus’ for retail investors.
The ETF is likely to be launched by end-March.