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Business News/ Markets / Stock Markets/  Government garners 600 crore from SUUTI stake sale in Axis Bank
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Government garners ₹600 crore from SUUTI stake sale in Axis Bank

The government has set a disinvestment target of ₹2.1 trillion for FY21, including the privatization of Air India and BPCL
  • Suuti sold 61.43 lakh shares of Axis Bank between 2 and 4 December, which fetched the government ₹374.21 crore, stock exchange filings show
  • Suuti sold 61.43 lakh shares of Axis Bank between 2 and 4 December, which fetched the government ₹374.21 crore, stock exchange filings show. (Bloomberg)Premium
    Suuti sold 61.43 lakh shares of Axis Bank between 2 and 4 December, which fetched the government 374.21 crore, stock exchange filings show. (Bloomberg)

    Taking advantage of the buoyancy in the equity market, the central government has sold nearly one crore shares of Axis Bank worth around 600 crore in last two weeks held through the Specified Undertaking of the Unit Trust of India (SUUTI) .

    Suuti sold 61.43 lakh shares of Axis Bank between 2 and 4 December, which fetched the government 374.21 crore, stock exchange filings show. Last month between 26 November and 27 November, it had sold 36.25 lakh shares for a consideration of 221.47 crore.

    Post these trades, Suuti’s shareholding in the lender is down to 3.92%. It held a 4.33% stake in the bank as of 30 September, stock exchange data shows.

    The Parliament bifurcated UTI in 2002, creating SUUTI and UTI Asset Management Co. Pvt. Ltd, the former holding the assured-return investment plans of UTI and the latter overseeing market-linked plans.

    The bifurcation took place after UTI’s US-64 investment plan ran into trouble.

    SUUTI has minority stakes in bunch of listed and unlisted companies, with most of its value locked in Axis Bank Ltd (11.53% stake), ITC (7.93%), and L&T (1.8%). It had earlier pared down its minority stakes in the Axis Bank and ITC and sold off most of its stake in L&T.

    The government has set a disinvestment target of 2.1 trillion for FY21, including the privatization of Air India and BPCL. So far this year government has garnered 6734 crore through minority stake sales and initial public offering of Mazagon Dock Shipbuilders Limited. It is, however, yet to carry out any strategic disinvestments so far this fiscal year. Government is confident of closing the BPCL deal this fiscal with three parties expressing interest for the company.

    While the finance ministry had missed the disinvestment target of 65,000 crore for FY20 by 14,701 crore, it is likely to miss the target again due to the pandemic induced economic downturn.

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    ABOUT THE AUTHOR
    Swaraj Singh Dhanjal
    " Based in Mumbai, Swaraj Singh Dhanjal is responsible for Mint’s corporate news coverage. For the past eight years he has been writing on the biggest deals in private equity, venture capital, IPO market and corporate mergers and acquisitions. An engineer and an MBA, he started his journalism career in 2014 with Mint. "
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    Published: 07 Dec 2020, 08:50 PM IST
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