Govt plans to divest 10% in IOC, 5% in ONGC

The government is set to divest 10 per cent of its stake in Indian Oil Corporation (IOC), and 5 per cent in Oil and Natural Gas Corporation (ONGC) next year, a senior official said today.

“ We are yet to appoint a banker for IOC's public offer, but we hope to complete the process in Q1 of the financial year of 2012-13," Disinvestment Secretary Sumit Bose told reporters on the sidelines of a Coal India press conference here.

The size of the IOC public offer will be "very big" as the government will divest 10 per cent of its stake in the oil refiner. It will also have a 10 per cent fresh issue, Bose said.

The public offer of Coal India is likely to break all previous records in the Indian capital market, Union Coal Minister Sriprakash Jaiswal said.

The government is diluting 10 per cent stake in Coal India through a public offer to raise Rs 15,400 crore, making it the biggest-ever IPO in India. The government currently owns 100 per cent stake in the company.

"Disinvestment means an opportunity for creating wealth and benefit investors," Jaiswal said.

Basu pointed out that the due diligence process was on for the Steel Authority of India Ltd public offer, and the government had already appointed bankers for the same.

Bose further said disinvestment in many big companies, including Shipping Corporation of India (SCI), Power Grid, Hindustan Copper and Manganese Ore India are expected in the current financial year.

The Centre last week cleared disinvestment of 10 per cent of its stake in SCI. The disinvestment in this Navaratna company is expected to generate about Rs 1,300 crore.

The government's ownership in SCI will come down to 63.75 per cent from the current 80.12 per cent after the share sale.

Aiming to raise Rs 40,000 crore through disinvestment this financial year, the government has mopped up over Rs 1,000 crore by divesting its stake in SJVN Ltd and around Rs 1,000 crore in Engineers India.