New Delhi: The government is preparing for another round of minority stake sales in listed state-run companies through the offer-for-sale (OFS) method. This move aims to accelerate progress toward its ₹80,000-crore disinvestment target for FY27, according to two people familiar with the matter.
The Department of Investment and Public Asset Management (Dipam) is evaluating a fresh set of listed central public sector enterprises (CPSEs) where the government's shareholding remains well above 60%, leaving sufficient headroom for stake dilution while retaining majority ownership, the people cited above said.
The move signals a renewed preference for market-based stake sales over privatisation, allowing the government to mobilise resources quickly without relinquishing management control. They indicated that companies with adequate public float, strong investor appetite and favourable market valuations are likely to be prioritised.
- Government plans CPSE stake sales via OFS to hit FY27 disinvestment target.
- Dipam is screening CPSEs with over 60% government holding for dilution.
- Seven OFS deals this fiscal year have already raised over ₹20,000 crore.
- Government retains majority control in all seven companies despite the recent sales.
- Experts say the OFS route needs to monetise just 3-4% of CPSE holdings.
The development comes after a series of successful OFS transactions earlier this fiscal year, including stake sales in Central Bank of India, Coal India, NHPC, NLC India, General Insurance Corporation (GIC Re), Indian Railway Finance Corporation (IRFC) and Cochin Shipyard Ltd., which together mobilised more than ₹20,000 crore.
Queries sent to the Department of Investment and Public Asset Management (Dipam) secretary and the finance ministry spokesperson remained unanswered till press time.
The government garnered ₹16,885.56 crore from disinvestment in FY26, compared with ₹10,163.02 crore in the previous fiscal year, according to Dipam data. In addition to disinvestment receipts, ₹28,420.49 crore was raised through asset monetisation in FY26. There were no asset monetisation receipts before FY26.
Govt still in control
The proposed strategy comes against the backdrop of the Centre's recent minority stake sales through the OFS route. Even after these transactions, the government continues to hold well over 60% in all seven CPSEs—81.19% in Central Bank of India, 61.13% in Coal India, 61.39% in NHPC, 69.47% in NLC India, 77.40% in GIC Re, 82.90% in IRFC and 63.33% in Cochin Shipyard.
"The process of identifying CPSEs for minority stake sales is ongoing. Dipam is evaluating companies where the government's shareholding remains sufficiently high to facilitate further dilution while retaining majority ownership and management control," said the second person mentioned above.
"Once the internal assessment is completed and the necessary approvals are in place, the selected CPSEs will be taken up for stake sales through the OFS route," the person added.
The broad universe of CPSEs being evaluated for potential minority stake sales includes companies where the government's shareholding remains well above 60%, such as Rail Vikas Nigam Ltd (RVNL), Mazagon Dock Shipbuilders, Garden Reach Shipbuilders & Engineers (GRSE), Bharat Dynamics Ltd (BDL), RailTel Corporation, RITES, Ircon International, Manganese Ore (India) Ltd, Hindustan Copper and some fertiliser companies, according to both the people cited above.
However, they clarified that these companies are only indicative of the broader universe under consideration and that no final decision has been taken on which CPSEs will eventually be selected for stake sales.
The government has budgeted ₹80,000 crore from disinvestment and asset monetisation in FY27, significantly higher than in recent years, as it seeks to strengthen non-tax capital receipts while adhering to its fiscal consolidation road map.
Why govt relies on OFS route
Experts believe minority stake sales through the OFS route remain the path of least resistance for the government. With listed CPSE holdings exceeding ₹22 trillion against a disinvestment target of ₹80,000 crore, the government needs to monetise only about 3-4% of its portfolio to meet the goal.
"Unlike strategic sales, which often get bogged down in regulatory approvals, valuation disputes and bidder diligence, OFS transactions can be executed in weeks by taking advantage of favourable market windows. The pace in early FY27—seven OFS deals in three months—shows this is a far more reliable and repeatable route to meeting the target," said Divakar Vijayasarathy, founder and chief executive officer of DVS Advisory Group, a tax and business advisory firm.
However, while this approach may comfortably help achieve the fiscal target, it does not necessarily fulfil the broader objective of disinvestment—genuine privatisation and the government's exit from non-core sectors. The numbers may be achieved either way, but the structural reform agenda risks taking a back seat, Vijayasarathy said.