As the government continues to look for avenues for stake sale in state-run companies to meet its ambitious disinvestment target of Rs 72,500 crore, its think-tank Niti Aayog has recommended a strategic disinvestment of 34 sick PSUs so far.
As the government continues to look for avenues for stake sale in state-run companies to meet its ambitious disinvestment target of Rs 72,500 crore, its think-tank Niti Aayog has recommended a strategic disinvestment of 34 sick PSUs (public sector undertaking) so far, Amitabh Kant CEO of Niti Aayog said at an event. The Prime Minister’s Office (PMO) had asked the think-tank to look into the viability of sick state-run companies, PTI reported.
“We have recommended 34 sick PSUs for strategic disinvestment,” Amitabh Kant said. The Indian government has undertaken strategic stake sale in profitable PSUs to help boost state revenue and bridge the fiscal deficit. It has an ambitious target to earn Rs 72,500 crore in the current financial year 2017-18 through stake sale in state-run companies. This includes Rs 46,500 crore from minority stake sale, Rs 15,000 crore from strategic disinvestment and Rs 11,000 crore from the listing of PSU insurance companies.
The government seems to be leaving no stone unturned in its effort to maximise its earnings from the disinvestment of equity stakes in PSUs this year. The government raised Rs 46,247 crore through disinvestment In the last financial year 2016-17, the highest ever amount earned by the sale of the equity stake in PSUs, though falling short of the original target, as was expected. The government has announced the launch of Bharat-22 — a new ETF (exchange-traded fund) of 22 companies — buoyed by the encouraging response to its earlier CPSE ETF — a fund of 10 state-run companies.
So far this financial year, the government has sold equity stakes in Hindustan Copper through a recently concluded OFS (offer for sale), Cochin Shipyard, HUDCO, L&T (held through SUUTI) and Dredging Corporation, among others. This fiscal, the government seeks to sell 10% equity stake each in three major state-run railway companies IRCTC, Ircon and IRFC via IPOs. In February, SUUTI sold 2% from its 11.7% equity stake held in the tobacco major ITC Ltd in a block deal for reportedly Rs 6,700 crore.