New Delhi: The government is unlikely to top this year’s expected $9 billion bumper crop of state share sales in the next fiscal year starting in April, a senior finance ministry official told Reuters on Wednesday.
The government plans to sell stakes in Indian Oil Corp, ONGC and Steel Authority of India Ltd (SAIL) in the last quarter of this fiscal year ending in March, even if there is a correction in markets, said the source, who is directly involved in the stake sale programme.
The share sales, headlined by the recent $3.4 billion IPO by Coal India, are part of government plan to sell stakes in about 60 state-run firms in an effort to cut its fiscal deficit and boost spending on welfare programmes. Power Grid Corp of India is in the midst of a $1.7 billion share sale.
Share sales in state run firms Manganese Ore India Ltd (MOIL) and Shipping Corp are likely to hit the market by end-November, while an offer by Hindustan Copper is likely in December, disinvestments secretary Sumit Bose said this week.
The source said the government would sell a 5% stake in energy explorer ONGC and a 10% stake in refiner Indian Oil even if there was no decision on deregulation of diesel prices or a delay in a decision on sharing the subsidy burden among oil companies and the government.
“That is not our concern. The tail cannot wag the dog,” said the source.
“We are doing it independent of any decisions,” he said.
Analysts have said delay in a decision on deregulation of diesel prices and sharing of subsidies could discourage investors in Indian Oil and ONGC.
Indian Oil is also considering the issue of a 10% stake in fresh equity to raise additional funds.
The government plans to sell a 5% stake in state-run steel major SAIL in the next quarter, and SAIL may also an additional 5% of fresh equity, he said.