Cabinet nod for stake sale in Coal India, Cochin Shipyard

By: | Updated: November 18, 2015 9:07 PM

The Cabinet today approved 10 per cent stake sale in Coal India and initial public offer of Cochin Shipyard amid growing concerns over meeting Rs 69,500 crore disinvestment target in the current fiscal.

Coal IndiaAt current market capitalisation, 10 per cent stake sale of Coal India could fetch about Rs 21,137.71 crore. (Reuters)

The Cabinet today approved 10 per cent stake sale in Coal India and initial public offer of Cochin Shipyard amid growing concerns over meeting Rs 69,500 crore disinvestment target in the current fiscal.

“Government has approved sale of 10 per cent stake in Coal India Limited (CIL),” Coal and Power Minister Piysh Goyal told reporters after the Cabinet meeting here.

Asked about government’s expectations from the stake sale in the CIL, Goyal said it hopes to mop up around Rs 20,000 crore.

At current market capitalisation, 10 per cent stake sale of Coal India could fetch about Rs 21,137.71 crore. Government holds 79.65 per cent stake in Coal India.

Coal India Ltd worker unions, however, have been opposing the stake sale in the national miner.

The Cabinet has also approved the proposal for issue of an Initial Public Offer (IPO) of Cochin Shipyard Ltd (CSL).

According to an official statement, the approval is for the public issue consisting of 3,39,84,000 equity shares of Rs 10 each amounting to an equity capital of over Rs 33.98 crore of CSL.

The IPO will consist of fresh issue of 2,26,56,000 equity shares and sale of government’s stake in CSL worth 1,13,28,000 equity shares of Rs 10, through a public offering in the domestic market.

The fresh shares are being issued by CSL to part-finance its expansion like setting up of an International Ship-repair Facility (ISRF) at Cochin Port Trust area and Setting up of a large dry dock within the CSL premises to take up construction of larger ships such as large sized Aircraft Carriers and VLCCs as well as to take up underwater repairs to rigs and semi submersibles.

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