With just about 40 days of this financial year, the finance ministry had chosen to push back residual stake sales in Hindustan Zinc Ltd and Balco to FY15. However, the stake sale in Axis Bank will go through this fiscal.
“The decision to divest stakes (in the two companies) stands. However, the process may not be completed this year before March 31. Therefore, we have kept it for the next year,” said Arvind Mayaram, secretary, department of economic affairs at the Post-Budget press conference.
Chidambaram, who has recused himself from the stake sales in Vedanta Group companies HZL and Balco, however said, “Only the SUUTI stake in Axis Bank will be taken up this year. It is too early to say whether we sell the rest of the SUUTI stakes in companies like L&T and ITC next fiscal.”
Accordingly, the Interim Budget FY15 that was tabled in Parliament on Monday has pruned the target from residual stake sales to Rs 3,000 crore in the revised estimates from the earlier Rs 14,000 crore while the overall mop-up from disinvestment proceeds have been kept at Rs 25,841 crore as against the targeted Rs 54,000 crore.
For FY15, the disinvestment proceeds have been estimated at Rs 56,925 crore. Of this, Rs 36,925 crore is expected from selling stakes in public sector companies and Rs 15,000 crore from residual stake sales in companies, including HZL and Balco.
The Cabinet Committee on Economic Affairs has recently also approved sale of residual government stake of 29.54 per cent in HZL and 49 per cent in Balco through an open auction. Since then the government has also set up an inter-ministerial group to finalise the modalities and valuation of the two companies.
Disinvestment secretary Ravi Mathur said the IMG is expected to meet later this week to approve the Request for Proposal for the two firms.