Disinvestment target revised upwards to Rs 58,425 cr

Finance Minister Arun Jaitley today raised the disinvestment target for the current fiscal to Rs 58,425 crore.

The target includes Rs 43,425 crore from selling stake in PSUs and another Rs 15,000 crore from sale of residual stake in the erstwhile government companies, as per the Budget document.

This is higher than the Rs 51,925 crore PSU stake sale target estimated in the interim budget presented in February by the UPA government.

While a 5% stake sale in SAIL is on the cards, the disinvestment department is also looking at 10% stake sale in Coal India.

Also a Cabinet note has been floated for a 5% stake sale in ONGC which could fetch about Rs 17,000 crore to the exchequer.

Besides, another 10.96% stake is likely to be on offer for NHPC and 5% each in PFC and REC.

Besides, the department is also looking at residual stake sale in Hindustan Zinc and Balco.

With stock markets on an upturn and Sebi pushing for minimum 25% public holding in PSUs, the disinvestment department has revised the target upwards.

There will be some companies in which the stake sale process will be fast tracked in the current fiscal in view of 25% public holding norm, sources said.

The stock market barometer BSE Sensex has rallied over 21% so far this year.

Sources said the PSUs shares are trading at good valuations and a divestment now would help garner more funds.

Disinvestment proceeds are vital to the exchequer to lower the fiscal deficit. The deficit was at 4.5% of GDP in 2013-14 fiscal and targeted to be brought down to 4.1% in current fiscal.

Last month, market regulator Sebi said all listed PSUs should achieve a minimum public shareholding of 25% within three years.

The decision, aimed at ensuring uniformity among listed entities, 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%.

Under current norms, government undertakings should have at least 10% public shareholding whereas for non-PSU firms the minimum level is 25%.