Centre to offload 5% stake in ONGC for 18,000cr

New Delhi, Oct. 20: The government is likely to divest 5 per cent stake in ONGC in the first week of November, which may fetch about ` 18,000 crore to the exchequer, a finance ministry official said.

“Keeping valuations in mind, this is the right time to divest in ONGC,” he said, adding that the stake sale is likely to happen in the first week of November. He said the disinvestment secretary on Monday held a meeting with the merchant bankers in this regard.

The Cabinet had last month cleared 5 per cent stake sale in ONGC. The disinvestment department has selected 5 merchant bankers — Citigroup, HSBC Securities, UBS Securities, ICICI Securities and Kotak Mahindra Capital — for managing the stake sale.

The ONGC scrip was trading with a gain of 6.21 per cent in the afternoon at ` 421.90 on the BSE. At the current market price, the sale of 5 per cent stake or over 42 crore shares, would fetch about ` 18,000 crore to the exchequer. Official fur- ther said that gas price hike decision and diesel deregulation would give clarity to investors.

After a long wait, the government on Saturday deregulated diesel prices and raised the natural gas rates. While diesel deregulation is an important reform initiative, hike in gas prices will directly benefit oil exploration companies.

The merchant bankers will advise the government on the timing and modalities of OFS and ensure best returns to the government.