Sell-off in state run companies is critical to keep the fiscal deficit under check
GN Bureau | May 13, 2015
The government has approved stake sales in giant state-owned units Indian Oil (IOC) and National Thermal Power Corporation (NTPC) to mop up close to Rs 10,000 crore. The proposal was cleared at union cabinet meeting on Wednesday.
While ten per cent stake in IOC would yield Rs 7,915 crore at the current price of Rs 326.70 a share, a 5 per cent equity offload in NTPC would give Rs 557 crore to the government at prevalent market price of Rs 134.80. These stake sales are part of the ambitious disinvestment drive to raise Rs 69,500 crore by March 2016. Sell-off in state run companies is a critical element of finance minister Arun Jaitley's plan to boost spending and yet keep the fiscal deficit under check.
As the news came out the IOC stock fell over 2 per cent, while the NTPC stock was trading nearly 5 per cent down. The two stocks underperformed the broader Nifty and the Sensex which were trading flat.
The government has set a target of Rs 41,000 crore from disinvestment in the current financial year against Rs 26,000 crore in the previous year. Besides, the government hopes to get Rs 28,500 crore from strategic sales.
The finance ministry has been pushing for sale of stake in Indian Oil during the last financial year but had to drop the plan as there was no clarity on the subsidy-sharing mechanism. The petroleum ministry had opposed it as the fall in crude prices have an impact on valuations. With oil prices beginning to rise and more clarity on subsidy sharing, the government seems to have taken up the Indian Oil stake sale.
The state-of-the-art corporate office of oil and natural gas corporation (ONGC), Pandit Deen Dayal Uphadhayay Urja Bhawan, in New Delhi has won leadership in energy and environmental design (LEED) India ‘platinum’ award by US green building council (USGBC), the highest recognition f
Demonetisation was a factor as candidates in the fray for the Mumbai civic polls wooed people. Though the election commission doubled the expenditure limits from Rs 5 lakh to Rs 10 lakh, some candidates found the going hard as there was a weekly withdrawal limit of Rs 24,000. Rs 10 lakh is way ab
Nathuram Godse, who was brought up by his parents as a girl in the first few years of his life, has been reviled for decades for fatally shooting the apostle of peace Mahatma Gandhi. What Godse said during the Gandhi assassination trial has not been made public, giving rise to considerable speculation.
The first coal rake of NTPC’s Pakri-Barwadih coal mine at Hazaribagh was flagged-off by finance minister Arun Jaitley, Jharkhand chief minister Raghubar Das, union minister of state for power, coal, N&RE and mines Piyush Goyal, and minister of state for civil aviation Jayant Sinha, at Ranchi on
“Our corporator is missing,” reads a banner on a defunct lamppost in Shaniwar Peth – a densely populated area in Pune, the second largest city of Maharashtra after Mumbai. Many more sprang up in the nearby alleys, a couple of months before the municipal corporation polls on February 21.&n
On October 1 last year, Mehtab Alam Ansari, 30, who worked as a tailor in Delhi, had arrived in his village, Chepa Khurd in Barkagaon tehsil of Harazibagh district, to celebrate Eid with his family. That morning, he was nearing Dadi Kalan, a neighbouring village, to meet an acquaintance when he heard gunsh