Disinvestment target likely to be revised upwards

With stock markets on an upturn and Sebi pushing for minimum 25 per cent public holding in PSUs, the disinvestment department is likely to revise upwards the Rs 51,925 crore PSU stake sale target in the current fiscal.
Sources said the new government is eyeing higher funds from PSU stake sales. The final budget for 2014-15 fiscal would be presented on July 10.
There will be some companies which will be fast tracked for stake sale in the current fiscal in view of 25 per cent public holding norm, sources said.
The stock market barometer BSE Sensex has rallied over 13 per cent so far this financial year.

Sources said the PSUs shares are trading at good valuations and a divestment now would help garner more funds.
Disinvestment proceeds are important to the exchequer in to lower the fiscal deficit. The deficit was 4.5 per cent of GDP in 2013-14 fiscal and is to be brought down to 4.1 per cent in current fiscal.

As per the interim budget, about Rs 15,000 crore was to be mobilised from stake sale in HZL and Balco and while Rs 36,925 crore was to come from minority stake sale in PSUs. The total proceeds from disinvestment was estimated at Rs 51,925 crore.

Last week, market regulator Sebi said all listed PSUs should achieve a minimum public shareholding of 25 per cent within three years.
The decision, aimed at ensuring uniformity among listed entities irrespective of their promoters, would also help the government raise close to Rs 60,000 crore from the sale of shares in around 36 listed PSUs where the public shareholding is less than 25 per cent.
Under current norms, government undertakings should have at least 10 per cent public shareholding whereas for non-PSU firms the minimum level is 25 per cent.
While a 5 per cent stake sale in SAIL is on cards, the disinvestment department is also looking at 10 per cent stake sale in Coal India.

Besides, another 10.96 per cent stake is on offer for NHPC and 5 per cent each in PFC and REC.
Besides, the department is also looking at residual stake sale in Hindustan Zinc and Balco.