Markets not to hit PSU stake sale plan: Department of Disinvestment
29 Jun 2012
The government plans move ahead with the planned stake sale of public sector companies without waiting for further improvement in market sentiments, department of disinvestment secretary M H Khan told reporters in New Delhi today.
The Union Budget has targetted a realisaton of Rs30,000 crore from stake sale in a host of public sector units, including SAIL, BHEL, NALCO, Hindustan Copper, and RINL among others in 2012-13.
Khan said if Rs30,000 crore divestments realisation target had to be achieved during the current financial year, "we cannot wait for the market to improve beyond a point."
He disclosed that the the disinvestment department, which comes under the finance ministry, has already started roadshows for a 10-per cent initial public offer of Rashtriya Ispat Nigam Ltd (RINL). The stake sale could fetch about Rs2,500 crore to the exchequer.
Khan said there had not been a huge outflow of funds from foreign investors so far in the current fiscal.
He said, "If you have to sell in the market, you will have to sell at the price which market is willing to pay. In this quarter although there is not very big inflow, but at the same time there has not been a very big outflow. So the interpretation suggests that Indian stocks still remain an attractive proposition," he added.
In June, foreign institutional investors pulled out funds worth over Rs230 crore.
They had withdrawn Rs347 crore from the equity market in May, and Rs 1,109 crore in April. The stock markets have declined about 2 per cent since April.
