Giving a leg-up to the Centre’s disinvestment scheme, state-run Coal India (CIL) and KIOCL (formerly Kudremukh Iron Ore Co) will buy back their own shares next month.
CIL’s wholly-owned subsidiary Mahanadi Coalfields (MCL) will buy back shares equivalent to 25% of its aggregate fully paid-up share capital and free reserves from the parent. CIL would use the proceeds to buy back shares from the Centre and other shareholders. As on March 31, 2018, MCL had 13,301 crore surplus cash. CIL fully owns Mahanadi Coalfields while the Centre owns 78.32% in CIL. Buybacks by CIL, ONGC, Oil India and KIOCL could fetch the Centre about Rs 12,000 crore, an official said. The Centre has mopped up only Rs 9,220 crore or a little over 11% of the annual disinvestment target achieved so far. It has lined up a plan to conclude a series of stake sales by November-end, as it aims to exceed the FY19 disinvestment target of Rs 80,000 crore.
Officials said the government will likely sell a 5% stake each in ONGC and CIL, which could fetch about Rs 20,000 crore.