‘DeMo Cash can Flow into Markets’
DIPAM secy Neeraj Gupta says more investor-friendly products needed
New Delhi: The large amount of cash that has come back into bank accounts following the government’s demonetisation drive will look for avenues of investment and deepen the capital markets if more investor friendly products are available, said Department of Investment and Public Asset Management (DIPAM) secretary Neeraj Gupta. For the next fiscal, the government has set a mammoth disinvestment target of ₹ 72,500 crore, of which ₹ 46,500 crore is projected to come from regular stake sales including an exchange traded fund (ETF). The DIPAM secretary said that there is a great interest among retail investors, which is visible from the participation in the CPSE-ETF. “Retail investors cornered 41% of the issue size and more than 2.7 lakh investors had applied, which shows there is an appetite for good government products,” he said. Acknowledging that the new ETF proposed in the budget has to offer something fresh, Gupta said that the new ETF will be constructed by leveraging the strength of central public sector enterprises and other government holdings. The government has expanded the role of its disinvestment strategy, which has now become more of investment management, Gupta said, noting that the transaction pattern in disinvestment has undergone a transformation.
“We have explored various possible options including buyback, bulk deals and ETF,” he said.