The government has planned strategic stakes in companies like HLL Lifecare, PDIL, Shipping Corporation and BEML to meet the disinvestment target set in the next financial year 2023-24.
The government currently holds 29.54 per cent stake in Hindustan Zinc Limited (HZL). In 2002, the government sold 26 per cent stake in Hindustan Zinc Limited to the Vedanta Group headed by mining baron Anil Agarwal.
The Vedanta group bought another 20 per cent from the market and 18.92 per cent from the government in November 2003. After this, its stake in HZL increased to 64.92 percent. The company is the world’s second largest integrated zinc producer and sixth largest silver producer.
The government on Wednesday reduced the disinvestment target from Rs 65,000 crore to Rs 50,000 crore for the current financial year (2022-23). So far in the current financial year, Rs 31,100 crore has been raised through disinvestment.
Pandey, secretary of the Department of Investment and Public Asset Management (DIPAM), under the finance ministry, told news agency PTI in an interview that the revised target includes all transactions the government is working on, but the actual Yield will depend on market conditions.
He said, ‘What we have thought of raising from Hindustan Zinc Limited is included in this. However, it will depend on the market.
The Cabinet Committee on Economic Affairs (CCEA) had in May approved the sale of 124.79 crore shares or 29.54 per cent stake of the government in Hindustan Zinc Limited. The government can get around Rs 40,000 crore from the 29.54 per cent stake at the current price of Rs 325.45 per share.
Pandey said that since disinvestment is dependent on market conditions, it cannot be said with certainty that what is budgeted will be achieved.
“This item (disinvestment target in the budget) will remain uncertain,” he said.
Pandey said that for the next financial year, the government is actively tracking companies that are in advanced stages of strategic sale. These include HLL Lifecare, PDIL, Shipping Corporation, BEML and NMDC Steel.
Apart from this, the sale of Ferro Scrap Nigam Limited (FSNL) is expected to be completed, but the sale proceeds will go to the parent company MSTC and not to the government, he said.
“We have IDBI Bank and we hope to issue expression of interest for CONCOR soon,” he said.
According to the report of the news agency PTI, the government and LIC together are selling about 61 percent stake in IDBI Bank and for this they have received several Expressions of Interest (EOI).
Pandey said, ‘IDBI Bank has started the investigation. It is a long process as RBI and security clearance and documents have to be checked.
In respect of CONCOR, the cabinet had in November 2019 approved the strategic sale of 30.8 per cent stake with management control out of 54.80 per cent government equity. The government will retain 24 per cent stake after the sale without any veto power.
(With inputs from news agency Bhasha)
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