Tag: disinvestment

The government will select the winner in Air India’s disinvestment in about three weeks and two high-level committees will finalise the reserve price for the national carrier within this period. The reserve price of the carrier will be soon decided by the inter-ministerial group (IMG) headed by the secretary, Department of Investment and Public Asset Management (DIPAM), based on the inputs from government-appointed valuers. The Core Group of Secretaries on Divestment (CGD), chaired by the cabinet secretary, will then consider the IMG’s recommendation. The Tata group and SpiceJet promoter Ajay Singh are in the race to acquire the loss-making airline. This process is being targeted to be completed in three weeks, said a top government official. The security clearance of the bidders who have shown an interest by placing financial bids is underway, he added. Read more

Shares of Central Bank of India, Indian Overseas Bank (IOB) J&K Bank were locked in 20 percent upper circuit on the National Stock Exchange (NSE) on Monday on the back of heavy volumes amid reports that the two financial institutions CBI and IOB might be privatized. On the back of the rally in these three stocks Nifty PSU Bank index surged as much as 4.4 percent to 2,484.15 levels. All of the 13 constituents of the pack traded in the green with maximum gains seen for the counters such as J&K Bank, Indian Overseas Bank, and Central Bank. “Disinvestment news in CBI and IOB lead the rally in PSU Banking basket. For taking ahead of the divestment process, the center shall amend the Banking Regulations Act together with other banking laws. Read more

Analysts suggest investors accumulate stocks of PSUs, especially the ones that are likely to be disinvested, at the current levels from a medium-to-long-term perspective. “There are a lot of PSU stocks that have not participated in the market rally. The fall from their peak levels is a good opportunity to buy from a medium-to-long-term horizon. I am confident that the government will be able to achieve the fiscal 2021-22 (FY22) divestment target. Due to the ongoing second wave of Covid, it may dole out some relief measures, which will cost money. To fund such initiatives, it will have to go aggressive on divestment once the market conditions improve,” say experts. Read more

Shares of IDBI Bank jumped 10.6 per cent to hit an intra-day high of Rs 37.4 on the BSE on Tuesday after a Business Standard report stated that the Cabinet will soon consider the proposal to sell the government’s 45.5 per cent stake in the company, paving the way for strategic divestment in the lender. The cabinet approval will give the Department of Investment and Public Asset Management (DIPAM) the authority to move ahead with the divestment process,. The government had planned to sell its balance stake in IDBI Bank to private, retail, and institutional investors through the stock exchange in the last financial year. However, the pandemic delayed the plan, which the government intends to complete this year."DIPAM cannot move forward with the divestment process until approval from the cabinet is received, given that banks come under work allocation of the DFS. After the cabinet's approval, intermediaries can be appointed," an official told Business Standard.

Shares of Bharat Petroleum Corporation Limited (BPCL) declined 5 per cent to ₹ 392.35 apiece on the BSE in the intra-day trade on Tuesday after the government said it received multiple bids for privatisation of the country's second-largest fuel retailer. In the past one-month oil marketing company BPCL share has surged 27 per cent. The sale is crucial for the government in order to meet its disinvestment target of Rs 2.1 trillion for the current fiscal year. The government has not revealed the number of bidders. The transaction advisors for the sale of government 52.98 per cent stake in Bharat Petroleum which is worth ₹ 47,430 crores have reported receiving "multiple expressions of interest", Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said. Strategic disinvestment of BPCL progresses, Now moves to the second stage after multiple expressions of interest have been received," Finance Minister Nirmala Sitharaman said on Twitter.

The Finance Ministry today (19th June 2020) Kick-started the process of LIC disinvestment, by inviting bids from consulting firms, investment bankers, and financial institutions for advising it on the proposed initial public offer. The government proposes to engage up to two pre-IPO transaction advisors, for assisting the Department of Investment and Public Asset Management (DIPAM) in the preparatory processes leading to the Initial Public Offer (IPO) of Life Insurance Corporation of India (LICI), tipped to be the largest ever in the country. The advisors can submit their bids from today till July 13, 2020. The bids would be opened by DIPAM on July 14. Read more