The Centre is considering to sell up to 10% in realty firms NBCC and Housing and Urban Development Corporation (Hudco) via an offers for sale (OFS), in what could fetch the Centre over Rs 2,400 crore at current market prices. While the process is likely to be initiated shortly to appoint merchant banks to prepare groundwork for the transactions, the timing of the OFS would be decided later depending on market conditions, officials said. At current market prices, a 10% stake sale in Hudco could fetch about Rs 1,100 crore while a similar stake sale in NBCC could garner a little over Rs 300 crore.
In May last year, the Centre had sold about 10% stake in the initial public offering of Hudco to mop up Rs 1,207 crore at an issue price of Rs 60 per share. Hudco’s share price rose 1.19% to close at 55.25 on the BSE on Friday. However, the NBCC share closed 1.33% down at Rs 74.25.
Besides a fresh tranche of an existing CPSE ETF, officials are pinning hopes that line-up of OFS including in ONGC, Indian Oil, NHPC and Bharat Electronics could fetch a substantial sum to achieve the Centre’s ambitious disinvestment target of Rs 80,000 crore in FY19.
While the Centre could mop up a whopping Rs 1 lakh crore from disinvestment in FY18, helped by ONGC’s Rs 37,000-crore purchase of the government’s 51.1% stake in Hindustan Petroleum, the target for FY19 is challenging as the pipeline is modest and markets have become volatile. So far this year, the government has realised Rs 9,220 crore as disinvestment proceeds.