Govt may tap OFS for disinvestments in rest of FY24
NEW DELHI : The government plans to tap the offer-for-sale (OFS) route for disinvestments in listed public sector enterprises during the rest of the fiscal year instead of initiating fresh strategic sales, a government official said. “Towards the end of the fiscal year, there are usually a few OFS," the official said, adding this would not be done with the aim of meeting budget targets. “Some PSUs (public sector undertakings), where the minimum shareholding norms have to be met, may be considered," the official said on condition of anonymity.
The government decided against strategic disinvestments given weak market conditions, the official said. It is also averse to strategic divestments in PSUs that operate in states going into elections. Governments go easy on disinvestments ahead of elections since many investors are wary of possible political changes, a senior economist said on condition of anonymity.
Queries to the finance ministry remained unanswered. The government had started work on large strategic disinvestments in IDBI Bank Ltd, Shipping Corp. of India Ltd, BEML Ltd, Projects and Development India Ltd and HLL Lifecare Ltd, and was also considering Container Corp.
of India Ltd; however, none of these transactions are likely to be concluded this year. Till November, the government raised ₹8,000 crore from disinvestments, with more than half of it coming from a 3% stake sale in Coal India Ltd through an OFS. About ₹3,700 crore came from selling 5.36% in Rail Vikas Nigam Ltd, 4.92% in SJVN Ltd and 7% in Housing And Urban Development Corp.
Ltd (Hudco) last month, all through the OFS route. Meanwhile, the plan to sell 5-10% of Hindustan Zinc Ltd through an OFS is hanging fire. The Union budget had set a target of
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