The Centre will likely sell 3-5% stake in NTPC soon through the offer-for-sale (OFS) route to garner between Rs 3,500-6,000 crore. The roadshow for OFS was held on November 21-22 in Mumbai to gauge the investor appetite, an official said.
The share price of NTPC has been on the upswing for last few days partly due to its acquisition of the 720 MW Barauni Thermal Power Station from Bihar State Power Generation Company. On Tuesday, the NTPC stock closed at Rs 147.80 on the BSE, up 1.20% from the previous close.
NTPC, the largest thermal power producer in India and also a player in hydro power generation business, could also further boost the Centre’s disinvestment coffers this year by acquiring the government’s 63.79% stake in SJVN worth over Rs 7,000 crore.
The Centre’s holding in NTPC fell to 58.93% after disinvestment of 2.84% via further fund offer-3 of the CPSE ETF last month. In FY18, the government had mopped up Rs 9,269 crore by selling 6.75% via OFS in the state-run power producer.
The OFS route of disinvestment has taken a back seat this year as most PSU stocks are battered by market volatility. The NTPC OFS would be the second such sale this year after the Centre raised Rs 5,218 crore by selling a 3.19% stake in Coal India in November.
So far this year, the Centre has garnered about Rs 34,000 crore in disinvestment receipts, 75% of which via exchange-traded funds. While another `17,000 crore worth transactions are expected by end-January, about `15,000 crore is assured from the proposed Power Finance Corporation’s purchase of the Centre’s 52.63% stake in Rural Electrification Corporation after Cabinet accorded an in-principle nod to the deal recently. Of the transactions by January, the Centre could garner about `12,000 crore from share buybacks by PSUs.
Achieving the FY19 target, which the Centre has said it would, this year would be a major feat for the government aiming to contain fiscal deficit at the budgeted level of 3.3% for FY19. Last year, the Centre’s disinvestment receipt was a record `1 lakh crore, including `36,915 crore from sale of its 51% stake in HPCL to ONGC.