The government has asked all public sector undertakings slated for disinvestment in the current year to keep themselves in the state of readiness so that they could hit the market at short notice. The fresh directive has been issued on the expectation that most disinvestment issues may have to be squeezed-in during the last few months of the current fiscal as market conditions remain volatile.

Government sources said that companies including Hindustan Copper, Rashtriya Ispat Nigam and National Buildings Construction Corp have been told to start the initial groundwork on their proposed market offering. This would include appointment of merchant bankers, investment bankers and other consultants who could complete the basic groundwork before companies can file detailed red herring prospectus with the market regulator Sebi and finalise the offer date.

Companies such as SAIL and ONGC have already completed the process and are awaiting for the markets to stabilise to announce their public offer dates. In fact, ONGC was expected to hit the market on September 20 but the issue got deferred last week as the company did not find the market conditions conducive. Sources suggest that the government took this decision due to a price mismatch, drawing flak from the investor community, while some say, talks were called off because of a hefty burden imposed on the upstream company on account of sharing the losses of state-run oil marketing companies.

?We still expect that R40,000-crore target from disinvestment proceeds in 2011-12 is feasible. The preparedness of the companies will help public offers to be launched at best suited time to get maximum value from the market,? said a finance ministry official.

So far in the fiscal, the government has been able to mop up only R1,100 crore by offloading stake in Power Finance Corporation (PFC). The issues of SAIL, Hindustan Copper and now ONGC have all been deferred.

The department is expecting to pursue the stake sale offers of Rashtriya Ispat Nigam Ltd, and National Buildings Construction Corp in the January-March quarter of the fiscal year. Last year, the government had raised Rs 22,400 crore through divestment ? in Coal India, SJVNL, Power Grid, Engineers India, MOIL and Shipping Corporation of India.

Sources in disinvestment suggest that department is pushing for 5% stake sale in power equipment maker Bhel in November after the ONGC issue. The government will disinvest 5% equity in the company, out of its share holding of 67.72% through book building process and is expected to fetch nearly Rs 4,320 crore.

However the Finance minister Pranab Mukherjee had recently indicated in Parliament that the government would not disinvest its shares in any public sector company under the current volatile stock market conditions.

?We cannot sell our valuable assets in a market situation where we will not get adequate prices. The whole objective is to discover the latent price,? Mukherjee said in the Lok Sabha, while answering questions on the government?s disinvestment policy.