\nRecently, the Cabinet announced that all listed public sector undertakings (PSUs) should increase public shareholding to 10% while all profitable unlisted companies should go public. Mitra said the government had identified 50 unlisted public companies and 10 listed companies.
\nThe government is focusing on divesting stake in PSUs to curb its burgeoning fiscal deficit. Roughly speaking, fiscal deficit is the difference between the government\u2019s revenues and spending and India has run up a high deficit this year due to its spending to counter the effects of the global financial crisis.
\nThe divestment secretary said he was in talks with ministries of steel, coal and telecom to explore possibility of stake sales in SAIL, Coal India and BSNL respectively.
\n\u201cThe listings would unlock shareholder value in the companies. We have begun inter-ministry talks to identify potential candidates for divestment. The divestment would be considered on a case-to-case basis,\u201d Mitra said.
\nThe government has been aggressively pushing to sell some of its stake in public companies. Recently, it listed NHPC and Oil India on the exchanges even though the initial public offers (IPOs) received a lukewarm response from investors and many experts thought the government had overpriced the issues.
\nThis time though, the government would make sure it provides incentives for retail participation in the PSU stake sales, Mitra said. \u201cThe retail investor would benefit from the follow-on public offers (FPOs) [in case of listed companies], which would be priced at a discount to market price,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"