New Delhi: The Centre has already raised nearly three-fourths of its ₹80,000-crore asset-sale target for FY27, putting it on a stronger footing to meet a goal that it has repeatedly missed in recent years.
The sharp pace of fund-raising has been driven largely by offer-for-sale (OFS) transactions in public-sector companies, which have generated ₹51,787 crore — almost 90% of the total amount raised so far this financial year, according to official data reviewed by Mint.
After including ₹6,366.93 crore raised through asset monetisation, the government has mobilised ₹59,082.95 crore, or 73.85% of the ₹80,000-crore target set in the Union budget under miscellaneous capital receipts.
Notably, the government had missed its budgeted disinvestment target for four consecutive years through FY23, before discontinuing separate targets from FY24.
Data from the department of investment and public asset management (Dipam) showed that the bulk of the money came from the ₹31,515-crore realised from the sale of a 6.5% stake in Life Insurance Corp. of India Ltd (LIC) in early August. The transaction was also aimed at reducing the Centre’s holding in the insurer to 90% to meet the mandated 10% minimum public shareholding.
Another ₹20,272 crore has come from seven other OFS transactions — ₹5,542.36 crore from Coal India, ₹4,357.36 crore from NHPC, ₹3,090.47 crore from GIC, ₹2,266.13 crore from Central Bank of India, ₹2,081.27 crore from IRFC, ₹1,711.24 crore from Cochin Shipyard and ₹1,223.57 crore from NLC India.
The government has also received ₹2,553.43 crore in dividends from public sector undertakings (PSUs), taking total miscellaneous receipts to ₹61,636.38 crore, according to the latest data from Dipam. The proposed strategic sale of IDBI Bank, in which the Centre and LIC jointly hold about 95%, could provide a further boost to government receipts.
Separately, the government has received ₹118.73 crore from the strategic disinvestment of Indian Medicines Pharmaceutical Corp. Ltd. and ₹810 crore through remittance from SUUTI (Specified Undertaking of the Unit Trust of India), which are not included in the OFS-led calculation above.
Queries emailed to the spokesperson of the finance ministry and Dipam secretary remained unanswered till press time.
Target within reach
Analysts said strong investor appetite for the OFS route, where existing shareholders divest their stakes, could help the government meet its FY27 disinvestment and asset-monetisation target.
“We note that the first-quarter fiscal data have, so far, raised no alarm bells. That said, the government needs to build fiscal buffers against unforeseen global and domestic risks, particularly amid uncertainty over the Middle-East crisis and the risk of higher subsidy and import costs,” said Madhavi Arora, chief economist, Emkay Global Financial Services Ltd.
Moreover, divestment has consistently fallen short of budgeted targets in recent years, making a stronger push this year both necessary and timely, said Arora.
More sales ahead
The pace of stake sales marks a significant acceleration in the government’s asset-sale programme. In a written reply to the Lok Sabha on 27 July, minister of state for finance Pankaj Chaudhary said the government had realised ₹26,639.33 crore as of 22 July. The numbers quoted were before the LIC OFS happened.
Earlier, Mint reported on 24 July that the government was planning to launch a second series of OFS transactions with the objective of reducing its stake in select public sector enterprises while ensuring that its shareholding remains well above 60%, leaving sufficient headroom for future stake dilution while retaining majority ownership.
In its July response to Parliament, Chaudhary said separate disinvestment targets had been discontinued from FY24 and that the ₹80,000 crore provided in the FY27 budget falls under the broader category of miscellaneous capital receipts.
He also said the timing of individual disinvestment transactions depends on market conditions, investor interest, economic and geopolitical developments and administrative feasibility.