Delhi- Indian government is going to execute an elite step on Monday (August 24, 2015). It will sell 10% stake in IOC (Indian Oil Corporation). Indian Oil Corporation is India’s largest firm in the oil sectors. Government is taking the advantage of OFS (Offer for Sale) because this would add 9500 crore INR to the Indian treasury.
It is also heard that IOC is to increase its stake in CPCL which can impregnate 1500 crore INR. IOC will announce the floor (basic) price for the share sale and the offer for sale plan will be implemented on Monday morning. 2015 will be the year when IOC will do the sale stake for the 4th time and which is 4th disinvestment this year. Previous three stake sales had steeped them for over 3000 crore INR.
Indian government is currently holding 69% shares in Indian Oil Corporation but though it is focusing to raise another 70000 crore INR by disinvestment in current year. It is a great privilege for the government to be one of the highest share holder of IOC ( India’s biggest marketing and refining company in India). Government raised 13 PSUs in 2015 for sale of stake to obtain the yearly target.
IOC is owner of 1/4th of our country’s total refining capability of 215 million tons which is almost 55 tons. This is a great achievement from IOC as it also owns 25000 petrol pumps in India. In total, there are 53420 filling stations and hence it almost covers half of the country’s requirement. On Friday on Bombay Stock Exchange, shares of IOC went down to 394.46 a piece (which is 0.7% fall). Though IOC has already marked the profit of 990 million dollars in BSE, it is having local fluctuations in the market.Hence, according to the current market trend; government is going to grab 9500 crore INR which is huge for them.
The market conditions are not at all good so the government is willing to sell the stakes in 3 major PSUs: Dredging Corp, REC and PFC which will make the sum total of over 3000 crore INR. The pipeline is on the way to include another 25 PSUs like ONGC, Nalco and NMDC. The rumors are such that Coal India will soon get 10% stake from government but they are planning for it to find the right time to do that.
Arun Jaitley (Finance Minister) and Dharmendra Pradhan(Oil Minister) made this exigent decision after many meetings and consultation of the ministerial level. The decision was pretty hard to make as per the reports told by Jaitley.
The Finance team including Aradhana Johri exclaims “It is very good time to disinvest the specific stock and is a perfect appetite and we are confident about the positive outcome of the sale in the increasing market in coming future days.”