Govt likely to retain Rs 65K cr divestment target in FY16

At present, state-owned firms have to have a mandatory 10 pct public float and it is estimated that there are at least 30 PSUs where govt shareholding is more than 75 pct.

SAIL’s net sales realisation plummeted by 34% to Rs 24,403 per tonne between August 2014 and December 2015 (Photo: Reuters)

Undeterred by its lackadaisical disinvestment programme this fiscal, the Centre is likely to retain its target for proceeds from stake sales at about Rs 65,000 crore in 2015-16 as well.

“The target is likely to be similar if not more than what has been budgeted for this fiscal. The exact calculations are being worked out, but we think that it is easily attainable in 2015-16,” said an official, pointing out that from next fiscal the finance ministry will start offloading stake in PSUs to make them compliant with Securities and Exchange Board of India’s public float norms.

The Sebi had last year mandated that like in the case of private firms, the public float in state-owned firms should also be 25 per cent of their total shareholding. PSUs were given a three-years time to comply with the norms last June.

At present, state-owned firms have to have a mandatory 10 per cent public float and it is estimated that there are at least 30 PSUs, including Coal India Ltd and MMTC, where government shareholding is more than 75 per cent.

The department of disinvestment is understood to be finalising a list of such PSUs that can be taken up for disinvestment next fiscal.

Meanwhile, changing its strategy from the last few years, the government will go ahead with stake sales through out the year rather than bunching them up in the last quarter.

“Disinvestments were delayed in the last few years due to a variety of reasons. But beginning April 2015, we will try to do stake sales through out the fiscal based on market conditions,” said the official.

The Centre has set itself a target of Rs 63,425 crore from disinvestment proceeds (including residual stake sales in Hindustan Zinc and Balco) in 2014-15. But it has managed to raise just Rs 1,725 crore from a 5 per cent stake sale in Steel Authority of India Ltd till date. Finance minister Arun Jaitley has, however, stressed that the Centre would go ahead with more stake sales this fiscal.

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First published on: 15-01-2015 at 09:09 IST