Disinvestment drive: Dredging Corp divestment gets Narendra Modi Cabinet nod

By: | Published: November 2, 2017 6:23 AM

DCI disinvestment, under a process which could take more than six months, could fetch the Centre about Rs 1,400 crore at current market prices.

Disinvestment drive, Dredging Corp divestment, Narendra Modi, Narendra Modi Cabinet nod, Dredging Corporation of IndiaDCI disinvestment, under a process which could take more than six months, could fetch the Centre about Rs 1,400 crore at current market prices.

The Cabinet is learnt to have given an in-principle approval for strategic disinvestment of its 74.38% stake in Dredging Corporation of India (DCI) and its entire stake in three unlisted PSUs including Indian Medicines & Pharmaceutical Corporation (IMPCL) and Karnataka Antibiotics and Pharmaceuticals (KAPCL). DCI disinvestment, under a process which could take more than six months, could fetch the Centre about Rs 1,400 crore at current market prices. Following the news of disinvestment, the share price of DCI surged 20% to close at 669.95 on BSE on Wednesday. The firm is engaged in providing services in the field of maintenance & capital dredging services to major ports in India. The company reported total income of Rs 600 crore, a net profit of Rs 7.4 crore and net worth of Rs 1,520 crore in FY17. KAPL, engaged in manufacturing and marketing of allopathic formulations, had a turnover of Rs 330 crore and a net profit of Rs 20 crore in FY16. IMPCL, a producer of ayurvedic and unani medicines, reported a turnover of Rs 36 crore and a loss of Rs 3.3 crore in FY16. Kick-starting the process of strategic sale of PSUs after a gap of 13 years, the Centre had invited expression of interest bids last months for half a dozen PSUs including Pawan Hans and Bridge & Roof Co.

These companies are part of the 34 PSUs, which NITI Aayog recommended for strategic disinvestment. Other PSUs including profitable BEML would also be up for grabs over the next few months. India’s last outright sale of a PSU was carried out in 2003-04. On Wednesday, the Cabinet also gave an ex-post facto approval for a special banking arrangement of Rs 10,000 crore towards payment of outstanding dues to fertiliser firms, through which the subsidies are routed, in 2016-17. In future, the fertilisers department would avail the SBA with the concurrence of expenditure department. The finance ministry has allocated Rs 70,000 crore as fertiliser subsidy for FY18, the same as the previous year.

Among other decisions, the Cabinet also approved changes to the ongoing centrally sponsored scheme Rashtriya Krishi Vikas Yojana (RKVY) which would now focus on areas including value chain, post-harvest infrastructure and agri-entrepreneurship development. RKVY has been renamed as RKVY-Remunerative Approaches for Agriculture and Allied sector Rejuvenation (RAFTAAR) to be implemented for three years till 2019-20 with a budget allocation of Rs 15,722 crore, the government said.

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