Three days after setting stiff time-bound targets for listing of profitable central PSUs, the government on Monday initiated steps to divest up to 25% in the initial public offerings (IPOs) of three railways undertakings — IRCTC, IRFC and IRCON.
The department of investment and public asset management (DIPAM) has invited applications from merchant bankers to manage the IPOs in 2017-18. Though DIPAM did not specify how much stake the Centre would dilute in these IPOs, sources told FE that it could be up to 25% each depending on valuations. The bankers would have to submit their expression of interest by March 16. Currently, the government owns 99.729% in IRCON, 100% in IRCTC and 100% in IRFC.
Within three weeks of budget announcement to fast-track listing of PSUs, DIPAM on Friday prescribed that a profitable PSU would have to list on the exchanges within 165 days, after the administrative ministry is on-board for the plan. As per available data, there are 119 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.
As per the new action plan, an inter-ministerial group (IMG) led by the DIPAM secretary have been constituted for the appointment of advisers/intermediaries and to guide the process of disinvestment through public offer in the railways PSUs.