Centre lays out time-bound plan for listing of Central PSUS

Department of Investment and Public Asset Management outlines procedures

112 UNLISTED PROFITABLE STATE-RUN UNITS

HAVING PLANNED a 60 per cent jump in disinvestment revenue in 2017-18, the government has now set itself stiff time-bound targets for listing of Central PSUS. According to the procedures outlined by the Department of Investment and Public Asset Management (DIPAM) on Friday, a profitable PSU would have to list on the stock exchanges within 165 days, after the administrative ministry is onboard for the plan.

As per available data, there are 112 unlisted profitable PSUS. The last PSU IPO was that of NBCC in March 2012; next in line is Hudco, which will likely hit the market in March. The IPOS of Cochin Shipyard and Hindustan Aeronautics are at advanced stages of preparation.

“To expedite the listing of PSUS in a time-bound manner, the concerned administrative ministry (Am)/administrative department (AD) and/or Department of Investment & Public Asset Management (DIPAM) shall draw the list of eligible PSUS for listing within one month from the finalisation of audited accounts of the last financial year, based on the criteria of a positive net-worth, no accumulated losses and having earned net-profits in three preceding years,” DIPAM said.

“It will be the joint endeavour of DIPAM and the administrative ministries to successfully implement the new guidelines to unlock value in the unlisted PSUS for expansion of economic activity in the country,” DIPAM secretary Neeraj Kumar Gupta said. As per the new action plan, an inter-ministerial group (IMG) led by the DIPAM secretary would be constituted for the appointment of advisers/intermediaries and to guide the process of disinvestment through public offer.

The process for the appointment of advisers for the transaction, including merchant bankers/legal advisers, etc, would be completed within a period not exceeding eight weeks from the date of constitution of the IMG.

Also, an empowered committee (EC) headed by the secretary of the administrative ministry would be constituted with the mandate to complete timebound documentation of draft red herring prospectus (DRHP) and finalisation of ‘offer document’ for the IPO, as per an indicative time line provided.

Some analysts perceive the FY18 divestment target of Rs 72,500 crore, a 60 per cent jump from the estimate of Rs 45,500 crore in FY17, to be very ambitious. Apart from PSU listing, sale of the government’s SUUTI stakes and further pruning of government stakes in certain big PSUS like ONGC, Oil India and BHEL and buybacks of shares by PSUS are expected to boost the disinvestment revenue next year.

Choppy markets, lengthy processes and delays in decisionmaking at administrative ministries often resulted in shelving of listing of many PSUS. FE

MOMENTUM JHARKHAND