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Photo: Mint
Photo: Mint

Government misses disinvestment target for FY20 by Rs14,701 crore

  • DIPAM completes two strategic disinvestment transactions-- 74.49% stake in THDC at Rs7,500 cr and 100% stake in NEEPCO at Rs4,000 cr
  • It also completes strategic disinvestment of government’s stake of 66.67% in Kamrajar Port Ltd in favour of Chennai Port Trust

With NTPC Ltd buying government’s stakes in THDC India Ltd and North Eastern Electric Power Corp. Ltd (NEEPCO) for Rs11,500 crore, government has garnered 50,299 crore in 2019-20 fiscal year, falling short of the Rs65,000 crore full year target.

“DIPAM completed two more strategic disinvestment transactions. GOI’s 74.49% stake in THDC at a consideration of Rs7,500 cr and 100% stake in NEEPCO at Rs4,000 cr has been disinvested in favour of NTPC," social media handle of DIPAM secretary tweeted on Friday.

It also completed strategic disinvestment of government’s stake of 66.67% in Kamrajar Port Ltd in favour of Chennai Port Trust at a consideration of 2383 cr and buyback of about 2.24 crore shares by Mazagon Dock Shipbuilders Ltd (MDL) for about Rs278 crore to the government earlier this month.

Among major disinvestments in FY20, government garnered Rs26,500 crore through stake sales using CPSE ETF and another Rs4,369 crore through stake sales in Bharat-22 ETF. It also garnered Rs1,881 crore through sale of “enemy shares" in Indian companies.

Government had to defer a number of offers for sale (OFS) such as Coal India, SAIL, NMDC, PFC, IRCON and Hindustan Aeronautics planned towards the end of the financial year because of the volatility in the equity market.

In Budget for FY21, the government had to scale back its disinvestment target for FY20 to Rs65,000 crore from Rs1.05 trillion earlier as the privatization of Air India could not be completed. For FY21, government has set an ambitious disinvestment target of Rs2.1 trillion including Rs90,000 crore from initial public offer in Life Insurance Corporation (LIC) of India and government stake sale in IDBI Bank.

The outbreak of Covid-19 and the collapse in global crude oil price may have dealt a twin blow to the government’s plans to privatize Air India (AI) and Bharat Petroleum Corp. Ltd (BPCL). The government on Friday extended the deadline for submitting bids for buying 100% stake in Air India till April 30 from 17 March earlier.

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