Pawan Hans: Centre, ONGC likely to go for strategic divestment

By: |
New Delhi | Published: July 19, 2018 4:08:02 AM

The Centre and ONGC, which own Pawan Hans (PHL) in 51:49 ratio, are likely to bunch together their stakes for strategic disinvestment of India’s premier helicopter service provider, to garner a better price as well as make it attractive for prospective buyers.

The Centre had invited expression of interest (EoI) twice for its 51% stake in PHL–in October 2017 and April 2018. (Representational image: Reuters)

The Centre and ONGC, which own Pawan Hans (PHL) in 51:49 ratio, are likely to bunch together their stakes for strategic disinvestment of India’s premier helicopter service provider, to garner a better price as well as make it attractive for prospective buyers.

The Centre had invited expression of interest (EoI) twice for its 51% stake in PHL–in October 2017 and April 2018 – with the second EoI eliciting a better response. However, with ONGC also deciding to sell its stake in the company as part of its strategy to exit non-core businesses, the sale of Pawan Hans is being repackaged and an amended EoI would be issued soon, an official said.

Following the buzz on ONGC’s plan to sell its stake in PHL, the ONGC stock rose 2.69% on Wednesday to close at Rs 160.3.

Thanks to the Centre’s waiver of interest dues worth Rs 339 crore, PHL’s net profit rose nearly 4.6 times to Rs 260 crore in FY17. After a capital restructuring, the company’s networth also rose 68% to Rs 1,003 crore at FY17-end. PHL had a cash and bank balance of Rs 154 crore. With an outstanding debt of only Rs 24 crore, as on March 31, 2017, its debt to equity ratio was 0.06%.

PHL is the industry leader of helicopter operations in India with the highest number of fleet strength of 43 helicopters and availability of diverse fleet mix of light, medium and heavy helicopters to cater to different client needs. Its competitors Global Vectra Helicorp has 26 copters, Heligo Charters (8) and Himalayan Heli Services (4). PHL also maintains and operates helicopters owned by other customers such as ONGC. Global Vectra Helicorp and US-based Continental Helicopters were understood to have expressed interest in Pawan Hans in April.

Over the past years, contracts with ONGC and state governments have provided steady source of income (average 40-45% revenues from Oil & Gas sector and around 35-40% revenues from state governments). It provides helicopter services for offshore operations, inter island transportation, connecting inaccessible areas, rescue work, tourism etc.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.