IOC rights issue deferral signals no GOI shift on disinvestment policy

Indian Oil's decision to withdraw its Rs 22,000 crore rights issue highlights the govt's reluctance to reduce its stake in state-run enterprises, as fiscal priorities shift to sectors like rail, roads

India’s largest state-owned oil marketing company, Indian Oil Corporation (IOC), is caught between the rock of the government’s bare minimum shareholding and the hard requirement of raising over Rs 1 trillion to finance its projects.

Since no disinvestment is planned despite the government’s fiscal constraints, the company will have to redraw plans to finance its capex.

On Monday, the Maharatna company informed the stock exchanges that it was withdrawing a Rs 22,000 crore rights issue. This is the first time any state-owned company in India has taken such a step, according to Prime Database.

The reasons the