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Budget 2018: Modi govt targets disinvestment receipts of Rs 900 billion

The ONGC-HPCL deal is likely to fetch the government Rs 300 billion, the report said quoting sources

BS Web Team 

Govt gears up for divestment drive
Illustration: Ajay Mohanty

Eyeing Rs 1 trillion target through for next fiscal, the Modi government may end FY18 with Rs 900 billion selloff, almost twice the record figure of Rs 460 billion achieved last year, on the back of its stake sale in Hindustan Petroleum Corporation (HPCL) to Oil and Natural Gas Corporation (ONGC), according to The Time of India report.

The deal is likely to fetch the government Rs 300 billion, the report said quoting sources.

The sale of the government's stake in to is stuck on valuation. According to persons close to the development, the effort was to close the deal before the end of this month but the government was looking at getting a higher value for its 51.1 per cent stake in

Based on the current market capitalisation, a 51 per cent in is valued at Rs 323 billion, about Rs 23 billion higher than in last July when the Union Cabinet had cleared the sell-off. However, reports suggest that after evaluating the marketing network, physical assets and brand value of HPCL, the valuation could be around Rs 450 billion.

The Cabinet Committee on Economic Affairs had given in-principle approval for the strategic sale on July 19 last year.

The government's non-tax revenue is hugely dependent on the deal. As on January 2, total proceeds for 2017-18 stood at Rs 538 billion against the target of RS 725 billion set by Finance Minister Arun Jaitley. If the ONGC-deal works out, this will be first time since 2009 that the government would be surpassing the target.

First Published: Thu, January 18 2018. 09:47 IST