Selloff when market offers best price: FM

The government will consider disinvesting its stakes in Public Sector Undertakings (PSUs) when the stock market will offer the best possible value, said FM Pranab Mukherjee on Tuesday. The government, Mukherjee said, would first focus on those listed profitable PSUs where less than 10% stake is held by the public. But it would also consider part sale of its equity through follow-on public offerings. However, he refused to give the names of PSUs, in which the government will divest its stake. In case of Satluj Jal Vidyut Nigam Ltd and Rural Electrification Corporation, whose disinvestments have been approved, there would be a mix of fresh equity and direct government stake sale. There was a mix of direct disinvestment as well as fresh equity in the case of NHPC and Oil India that were listed recently. In case of NTPC, government would sell directly its stake without issuance of any fresh equity. In a statement, the government said the National Investment Fund, which gets proceeds of disinvestments, has earned less returns on investments than the minimum required in the first two years. Average income (of NIF) for first year was 8.47%. Average income of second year was at 10.02%.