Govt eyes Rs2,500 cr from NLC stake sale

Mint Asia ST - - News - BSY WARAJ S INGH D HANJAL

With

the gov­ern­ment suc­cess­fully rais­ing about Rs9,100 crore by sell­ing a stake in NTPC Ltd through an of­fer for sale (OFS), it is now look­ing at sell­ing a 15% stake in another power pro­ducer NLC In­dia Ltd, two peo­ple aware of the de­vel­op­ments said.

An OFS is likely this month, said one of the two peo­ple cited above, re­quest­ing anonymity as he is not au­tho­rized to speak to re­porters. The sale could fetch the gov­ern­ment as much as Rs2,500 crore at cur­rent mar­ket prices, he added.

“They are now eye­ing NLC In­dia as the next company to bring to the mar­ket for an OFS. The stake sale could be launched in the sec­ond half of Septem­ber,” he said.

As of mar­ket close on Tues­day,nlc In­dia’s shares were priced at Rs100 on BSE, giv­ing the company a mar­ket cap­i­tal­iza­tion of Rs16,777 crore. The gov­ern­ment cur­rently owns 89.32% in NLC In­dia. A 15% stake sale would help the gov­ern­ment pare its stake to be­low 75%.

A spokesper­son for the min­istry of fi­nance de­clined to com­ment on the stake sale plan.

NLC’S of­fer for sale is part of gov­ern­ment’s am­bi­tious di­vest­ment tar­get of Rs72,500 crore for this fis­cal.

As part of the plan, the gov­ern­ment se­lected seven pub­licly traded com­pa­nies where it would look at di­vest­ing its stake through an of­fer for sale. These in­clude power sec­tor firms NTPC, NLC In­dia Ltd, NHPC Ltd, Power Fi­nance Corp Ltd and Ru­ral Elec­tri­fi­ca­tion Corp Ltd. Other com­pa­nies in the list in­clude Steel Author­ity of In­dia Ltd and re­finer Indian Oil Corp. Ltd. The stake sales in these firms are likely to fetch the gov­ern­ment more than Rs30,000 crore. On 29 Au­gust, the gov­ern­ment launched the OFS for 5% stake in ther­mal power pro­ducer NTPC, with an op­tion to re­tain over­sub­scrip­tion for another 5%. The gov­ern­ment even­tu­ally re­ceived bids for 7% stake.

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