Govt to soon finalise disinvestment roadmap: Department of Disinvestment

Currently, the total receipts stand at Rs99,738.92 crore from the government’s various disinvestment programmes, ever since they begun in the financial year 1991-92, as per the data available with the DoD

New Delhi: The government will soon finalise the roadmap to raise a whopping Rs40,000 crore through disinvestment during the current fiscal. It will include sale of equity in blue chip companies like SAIL and ONGC, reports PTI.

“The Cabinet has so far given approval for the disinvestment of four state-run firms—PFC, SAIL, ONGC and HCL. We are in talks with various ministries and working on a roadmap that should be finalised by June-end,” Department of Disinvestment (DoD) additional secretary Siddharth Pradhan told PTI.

Exuding confidence that the DoD would be able to achieve the Rs40,000 crore target for the current fiscal, he said by way of share sales of the identified four PSUs through follow-on offers, a little over Rs15,000 crore was expected to be garnered.

The government has already raised Rs1,162 crore by divesting 5% stake in Power Finance Corporation in May. The follow-on public offer of SAIL is likely to hit the market next month and ONGC in July. Share sale programme of Hindustan Copper (HCL) is yet to take a concrete shape.

When asked about the potential PSUs that could hit the market this fiscal, Mr Pradhan while refusing to divulge details, maintained that his department was in touch with steel, mines, heavy industries and petroleum & natural gas ministries for identifying the companies.

The government, according to sources, have already identified RINL, MMTC and NBCC for stake sale and would be required to add more companies to the list to achieve Rs40,000 crore target during 2011-12.

The government had proposed a disinvestment target of Rs95,000 crore from sale of shares in public sector companies over the next three fiscals, including Rs40,000 crore in the current fiscal.

Against the same Rs40,000 crore target set for the last fiscal, the government is estimated to have raised only Rs22,400 crore by way of disinvestment in PSU companies. The gap could have been bridged a little more had the movement of the market not been topsy-turvy towards the end of the last fiscal.

Currently, the total receipts stand at Rs99,738.92 crore from the government’s various disinvestment programmes, ever since they begun in the financial year 1991-92, as per the data available with the DoD.

The Centre’s disinvestment policy states that the government has to retain majority shareholding of at least 51% and management control of the PSUs.

The policy also calls for listing of unlisted CPSEs with no accumulated losses and having earned net profit in three preceding consecutive years.

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RBI allows FIIs to hedge investments under ASBA route

The initiative is likely to facilitate FII investments under the ASBA route into equity market

The Reserve Bank on India (RBI) on 21st May has allowed foreign institutional investors (FIIs) to hedge foreign currency risks arising out of investment in IPOs made through ASBA route.

“Initial public offers (IPO) related transient capital flows under the application supported by blocked amount (ASBA) mechanism, foreign currency-rupee swaps may be permitted to the FIIs,” the RBI said.

Foreign currency rupee swaps for hedging flows under ASBA, RBI said, will be available for 30 days only.

The initiative is likely to facilitate FII investments under the ASBA route into equity market.

Under the ASBA facility, the application money of investors remains blocked in his bank account until the process of allotment of shares is completed.

The Securities and Exchange Board of India (Sebi) had introduced ASBA facility for public offers first in September 2008 when retail investors were allowed to use it.

The facility eliminates any delays related to refunds for the unallocated shares. Initially, it was offered to retail investors only and was given to other investors in 2009.

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Sanghvi Forging debuts at over 3% premium on NSE

On the Bombay Stock Exchange, Sanghvi Forging debuted at Rs85 and was later quoting at Rs90.10

Shares of Sanghvi Forging & Engineering got listed on the National Stock Exchange (NSE) today at a premium of over 3% vis-a-vis their issue price of Rs85 apiece.

Shares of the company opened at Rs88 apiece, reflecting a jump of 3.52% over the issue price on NSE. Later, the stock was trading at Rs89.90 apiece, up 5.76% from the issue price.

On the Bombay Stock Exchange, the scrip debuted at Rs85 and was later quoting at Rs90.10.

In terms of volume, over one crore shares of the company changed hands on the bourses in early trade.

The company had entered the capital market through a Rs36.9 crore initial public offer with a price band of Rs80-Rs85 a share.

The firm intends to utilise the issue proceeds for partly financing the cost of setting up a 15,000-mtpa open die forging unit (with single piece forging up to 40 mt) to manufacture proof-machined products such as stepped shafts, bars and hollows, blocks, flanged shafts, gear blanks and forging items.

The company is a manufacturer and exporter of forging products for the non-automotive sector.

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