NHPC stake sale to fetch government Rs2,400 crore

The finance ministry has initiated the process of divesting 11.36 per cent stake in state-run hydro-power producer NHPC, to raise an estimated Rs2,400 crore, and will soon appoint merchant bankers for the issue.

The government plans to offload 1,200 million shares of NHPC, comprising 11.36 per cent equity stake, through an offer for sale (OFS) in the domestic market.

At the current market price of Rs20 a share this could fetch the exchequer around Rs2,400 crore.

The department of disinvestment (DoD) under the finance ministry has invited expressions of interest from merchant bankers to act as book running lead managers and to assist and advise the government in the process.

NHPC will offer up to 10 per cent of the OFS to its employees at a discount of 5 per cent over the issue price.

Government currently holds 86.36 per cent stake in NHPC, which would come down to 75 per cent post divestment.

NHPC got listed on the bourses in 2009 after the promoter divested 5 per cent stake and the company issued 10 per cent fresh equity.

NHPC's paid-up equity capital stood at Rs12,300.74 crore as of 31 March 2012.

The government has lined up a host of companies, including Coal India Ltd, Indian Oil Corp and Hindustan Aeronautics Ltd, for stake sale, hoping to raise around Rs40,000 crore in the current fiscal.

The government, which taps the OFS route or the auction method to divest its stake in PSUs that come in top 100 companies as per market capitalisation, has been delaying the stake sale amidst market uncertainty.

Two months into the fiscal, the government is yet to start its divestment programme.