Govt plans to sell 3% stake in GAIL; could fetch ~1,800 crore

The government plans to sell three per cent stake in stateowned gas utility GAIL India which could fetch over ~1,300 crore to the exchequer.

Finance ministry has moved a draft Cabinet note for inter-ministerial consultations for selling over 38 million shares in GAIL through a public offer, official sources said.

At current trading price of ~345.15, the stake sale will fetch the government over ~1,300 crore. The government holds 56.11 per cent stake in GAIL.

Divesting three per cent interest will help government keep its shareholding well above 51 per cent - minimum strategic holding it has decided to keep in key public sector units.

With this, GAIL has joined the list of oil PSUs which the Department of Disinvestment (DoD) has shortlisted for disinvestment. In June, the DoD had floated draft note for selling three per cent stake in Bharat Petroleum Corporation. While the Cabinet has already approved sale of five per cent stake in Oil and Natural Gas Corp and 10 per cent in Indian Oil Corporation, DoD plans to sell 10 per cent in Oil India as well.

The government is targeting ~69,500 crore from stake sale in public sector units (PSUs) this financial year. Of this, ~41,000 crore is to come from minority share sale in PSUs and ~28,500 crore from strategic stake sale.

With volatile market conditions, the government has so far this financial year been able to divest five per cent stake each in Rural Electrification Corporation Limited and Power Finance Corporation Limited. It has raised over ~3,100 crore so far this financial year .

According to the public enterprise survey 2013-14, India has 234 central public sector enterprises, of which 46 are listed.