Cabinet clears listing of 11 PSUs

THE Cabinet Committee on Economic Affairs on April 12 approved the listing of 11 public sector undertakings, including five railway subsidiaries — Ircon International, Indian Railway Catering and Tourism Corporation (IRCTC),  Rail Vikas Nigam, Indian Railway Finance Corporation (IRFC) and RITES Ltd.
The plan to list railway subsidiaries IRCTC and IRFC was mooted by Finance Minister Arun Jaitley in the Budget. The Department of Public Asset Management (Dipam) has already initiated the process...
to fix a consultant for the listing of these two companies.
The non-railway companies approved for listing are Bharat Dynamics (BDL), Garden Reach Shipbuilders & Engineers (GRSE), Mazagon Dock Shipbuilders (MDSL), North Eastern Electric Power Corporation (NEEPCO), MSTC Ltd and Mishra Dhatu Nigam (MIDHANI).
The CCEA has also approved reservation of shares for eligible employees of 11 central public sector enterprises (CPSEs) in accordance with the extant provisions of Securities and Exchange Board of India (SEBI) regulations. To ensure wider participation by small investors, price discount up to 5 per cent on the issue price has also been approved for retail investors and eligible employees. The Cabinet also approved signing of a framework of understanding on cooperation in the hydrocarbon sector with Bangladesh. It also cleared a policy to provide purchase preference to all public sector undertakings under the petroleum ministry.
This is done to abide by the mandated 25 percent public shareholding in companies and unlock their value.
CCEA also approved a discount of up to 5 percent of the issue price for retail investors and eligible employees of the 11 CPSEs with a view to ensuring wider participation by small investors in the disinvestment programme. The government said in a statement that the stake sale may include offers of fresh shares for raising resources from the market. “However, actual disinvestment in respect of each CPSE along with the mode of raising resources has been delegated for decisions on a case-by-case basis to the Alternative Mechanism, headed by the finance minister,” it added. The government set a target of mobilizing Rs46,500 crore from the sale of minority stakes and Rs15,000 crore from strategic disinvestment in the 2017-18 budget. Also, the listing of the CPSE on the stock market needs to be completed within 165 days of the administrative department giving its nod.