The Centre is hopeful of not missing the disinvestment target by a huge margin for this financial year as it is expecting to add Rs 35,000 crore in the kitty from the strategic sale of its residual stake in Hindustan Zinc (HZL).
The finance ministry is likely to keep the disinvestment Budget Estimate (BE) for 2023-24 elevated as some large asset-sale receipts, which are on the cards, are likely next fiscal year, the Business Standard reported, citing unnamed government officials.
A disinvestment target of Rs 65,000 crore has been kept in the current fiscal year. So far, the government has raised Rs 24,544 crore.
“An internal assessment meeting on disinvestment proceeds and outlook for the next fiscal year will be starting next week. We expect HZL (stake sale) to go through this year. The BE for FY24 will factor in high-value disinvestments, which are in the pipeline and are expected to spill over to the next year,” the financial quoted a senior official as saying.
He emphasised that the target of asset sale would depend on the proceeds in process and market outlook. IDBI Bank, Container Corporation of India (Concor) and Shipping Corporation of India stake sale are among the major privatisation plans in the pipeline.
Another official said the strategic sector needs a lot of due diligence, which takes time, and the government expects to complete the sale of the residual stake in HZL in the current fiscal year.
At the current market capitalisation, the Centre’s stake in HZL is worth approximately Rs 35,000 crore.
The Centre expects to close IDBI stake sale in FY24 as it is a two-stage process wherein the potential bidders will have to meet the Reserve Bank of India’s ‘fit and proper’ conditions before submitting financial bids.
In October, the government invited initial bids to offload 60.72 per cent stake in IDBI Bank and asked them to submit bids by December 15. Currently, the Department of Disinvestment and Public Asset Management (DIPAM) is handling the stake sale of all public sector undertakings (PSUs), and it would be in a position to attract financial bids by the end of March.
Normally, the stake sale process needs at least nine months, so the deal is likely to be complete in FY24.
