With the Central government finances a bit stretched after higher devolution of tax revenue to states, achieving the disinvestment target is crucial to adhere to the FY16 fiscal deficit target of 3.9%. In an interview with Prasanta Sahu, disinvestment secretary Aradhana Johri says a robust pipeline of PSUs, a rolling plan and steps to expand the retail investor base will help achieve share-sale revenue target of R69,500 crore in FY16. Excerpts.

How do you plan to achieve the highest-ever disinvestment revenue target?

We have already started work for FY16. We have got a robust pipeline. There is no big stock like Coal India. So, how soon we achieve the target depends on market conditions and depth of the market. If the market allows, we can do two share sales a month also.

What is your strategy?

We will not wait for the last quarter to sell shares. We have to keep doing it continuously. Second, we have to keep adding new companies to the pipeline. When the market is right for a particular company, we will disinvest.

Which PSUs are set for divestment this year?

We are looking at all stocks that need to be disinvested. Some of them would be necessary for meeting Sebi’s listing criteria; then, there are those in which the government stake is below 75%, but still a large amount of money can be realised by selling a stake. In the existing pipeline, 50% are metal stocks. Metal stocks are down. In this context, we will keep adding different sector stocks to the pipeline.

What steps are being taken to increase retail participation?

I have written to the Department of Economic Affairs on this issue. There has to be a drive to open demat accounts, activate dormant ones and create market literacy among people. I have also asked ICICI and Edelweiss to prepare a paper on ways to increase retail participation. One thing that can be done is waiving demat account opening fee by banks.

Do you have a plan to raise money through ETF?

We are working with Goldman Sachs to make existing CPSE Exchange Traded Fund more retail friendly. That is the reason why we did not do it in FY15. Most likely, it will happen in FY16. But, instead of tap, we will use the tranche mechanism to raise about Rs 5,000 crore through ETF.
What is the plan on strategic disinvestment of profitable companies?

It is a statement of intent in the Budget. The shape is yet to be worked out. Basically, a renewed emphasis and focus will be given to strategic disinvestment.

How do you plan to check hammering of stocks ahead of offer for sales?

First, we have a rolling plan. We will get approval for a large number of companies. So, it will be difficult for the market to figure out which one we are going to sell. Second, we have suggested to the market regulator to put a circuit breaker on stocks if buying/selling is too much ahead of a share sale. We have also suggested closing of the normal trading window on the day of the offer for sale.