Cabinet paves way for three big stake sales – Offloading shares in ONGC, CIL, NHPC may fetch govt more than the year’s target
The Union Cabinet on Wednesday cleared a dilution of the government’s stake in Oil and Natural Gas Corporation (ONGC), Coal India Ltd (CIL) and NHPC Ltd. At current market valuations, the amount of its holdings the Centre wants to offload in these companies could fetch it as much as Rs 45,796 crore – more than the Budget target of raising Rs 39,925 crore through disinvestment in public-sector undertakings.
However, the actual proceeds for the exchequer could be a little less than the estimated value, as the three stake sales will take place in the secondary market, where investors usually place bids that are lower than the prevailing market price. Also, an uncertainty over pricing of natural gas could lower the proceeds from ONGC stake sale, while employee unions’ resistance might affect the CIL disinvestment.
For more visit: Business Standard
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