The government will pay a broker commission of 0.35% for selling shares to retail investors and 0.15% for roping in high net-worth individuals
The government today said that it will pay a commission to brokers selling public offers of State-run firms, in an attempt to woo retail investors for its ambitious disinvestment programme, reports PTI.
The government, which till now paid little or no commission to brokers, has fixed a commission of 0.35% for selling shares to retail investors and 0.15% for roping in high net-worth individuals.
“After consulting with brokers we have done the changes and the commission for brokers have been fixed at 0.35% for retail investors and 0.15% for HNIs,” disinvestment secretary Sumit Bose told reporters.
The changes have been done to attract more retail demand for the public offers, he said.
Earlier, the commission paid was included in the fees of the book-running lead managers (BRLMs). “Now the government will reimburse this commission to the BRLMs for the brokers,” he added.
The new provisions will be applicable to all the forthcoming public issues starting with State-run power producer Satluj Jal Vidyut Nigam. SJVNL’s public issue opens tomorrow.
“The new norm will be applicable to all subsequent issues, starting with SJVNL,” Mr Bose said.
The government is selling 10% of its equity in SJVNL through an initial public offering (IPO). The price band has been fixed at Rs23-Rs26 per share.
The government has set a target of Rs40,000 crore through disinvestment in the current fiscal.
A total of 123 projects currently under implementation have also been delayed due to problems in land acquisition, shifting of utilities, non-availability of environmental, forest and railway clearances and legal disputes
Around 75% of the projects completed by the National Highways Authority of India (NHAI) so far were delayed due to various reasons, including land acquisition problems, Parliament was informed today.
In a written reply to a question in the Rajya Sabha, minister of state for road transport and highways RPN Singh said that out of 230 projects completed by the NHAI so far, a total of 172, or 74.8% of the projects were delayed.
“A total of 123 projects currently under implementation are also delayed,” the minister said, adding that projects were mainly delayed due to problems in land acquisition, shifting of utilities, non-availability of environmental, forest and railway clearances and legal disputes.
Regarding cost overruns due to the delay in implementation of these projects, he said that the contracts, awarded on an Engineering, Procurement and Construction basis, had provisions for variation and cost escalation in case of delays beyond the control of the contractors.
The fourth quarter of the last fiscal has reported a dramatic downfall in real-estate sales across six cities. But, driven by speculation, Mumbai property rates are still booming
The realty industry in six cities—Mumbai Metropolitan Region, Pune, Hyderabad, National Capital Region, Bengaluru and Chennai has reported around 25%-35% decline in sales in the fourth quarter of the last fiscal which ended in March 2010 compared to the previous quarter which ended in December 2009.
In Mumbai, the scenario was the worst, as real-estate sales were almost nil during the fourth quarter of the previous fiscal. “Sales are down by 35% compared to the last quarter in Mumbai. There is a downfall in sales in almost all the six cities in the fourth quarter (of the last fiscal). This shows that inventories are again rising in all these places,” said Pankaj Kapoor, founder, Liases Foras.
The prices of properties in the western suburbs of Mumbai have dramatically increased in the last quarter. There is no logic behind this increase in price—only speculation seems to be driving the rise. Rates have gone up by 25%-30%, keeping buyers away from the market.
Earlier, properties away from south Mumbai used to quote at a lesser price. But now, a property at Andheri and Kandivali, both Mumbai suburbs and separated by a distance of almost 13 km (Andheri is closer to south Mumbai) are quoting almost the same property prices. A two-bedroom hall kitchen (BHK) of 1,080 sq ft in Thakur Village, Kandivali (East) is priced at Rs135,00,000 while a two-BHK of 1,097 sq ft is tagged at Rs140,00,000 at Andheri (East).
In the third quarter (Q3 FY10) property prices in Kandivali ranged between Rs7,000 per sq ft-Rs9,000 per sq ft but now the current price in this area is Rs12,000 per sq ft. Same is the scenario at Andheri, property which was tagged at Rs10,000 per sq ft in the last quarter is now available for Rs12,000 per sq ft-Rs14,000 per sq ft.