WE ARE BUILDING A STRATEGIC DISINVESTMENT PIPELINE
Business Today|December 13, 2020
The pandemic had put the brakes on the government’s ambitious disinvestment plans for the fiscal. However, things have started picking up as businesses go back to normal and markets regain their appetite for buying assets. The Department of Investment and Public Asset Management (DIPAM), entrusted with disinvestment of central public sector enterprises (CPSEs), has an uphill task ahead given that it is racing against time to meet the annual disinvestment target. DIPAM Secretary Tuhin Kanta Pandey, in a conversation with Dipak Mondal, lays down the road ahead for the department.
Dipak Mondal
The Union Budget targeted 2.1 lakh crore disinvestment, of which 1.2 lakh crore was to come from CPSEs. Latest data shows only 5,000 crore has been realised.

All pre-Covid Budgets across the world have gone topsy-turvy. The Coronavirus pandemic is an unprecedented event. Things changed beyond anybody’s comprehension. Nobody anticipated that there could be a lockdown and people would not be able to travel for months together. Therefore, talking of a February budget under these extra-ordinary and uncertain circumstances may not be appropriate. We have to see going forward what we can do.

What is the realistic target now?

There is no specific number as on date, because our effort has been to look at what we can do during and post-Covid. So, we should do whatever best we can. If you get fixated with target numbers, then you need to factor in the several lost months.

The issue is what we can do, and what we have been able to do. In July, because the debt market was doing well, while the equity market had crashed, we raised more than ₹10,000 crore through Bharat Bond ETF for CPSEs. It gave a fillip to capex proposals of CPSEs. We encouraged them to go to the market and raise bonds. They are well on course, trying to do their own capex, which is an important means of reviving the economy. When private sector appetite is not so good, because of these efforts, public investments have been accelerated. But because these funds were garnered through these bonds, they will not show up in disinvestment receipts. You need to look at DIPAM not merely from the disinvestment angle. We are actually into capital management of CPSEs.

Regarding disinvestment of equity, we need to see the impact of Covid on PSU stocks in general and specific sectors in particular. The quantum of receipts is a function of the number of shares and their value. If the value is too low, it may not be worth to dispose of stocks at a very low valuation. We need to have perseverance.

As the equity market revived, we participated in some things we could do — bringing stock to market where liquidity is low, where you don’t actually have adequate stock in the market, because that’s something which is being demanded by the market. For example, if you are below minimum public shareholding norms, then according to Sebi’s requirements we need to achieve it. So we have treated that as a priority.

So, what is your Plan B now?

When you say Plan B, it is like changing strategy. Some of those are not just doing things, but in the manner we may take up our transactions. We came out with the ₹444-crore Mazagon Dock initial public offering (IPO) and broke the jinx that PSUs cannot be listed effectively. It received subscription of ₹65,000 crore (157 times the amount on offer). You may see it as a small number, but Mazagon Dock can encourage other IPOs of the government. That will bring new stocks to the market. It does not affect other stocks like price overhang, which happens when we keep coming to the market frequently for an existing stock. The price does not rise, and investors don’t get returns — giving a poor perception of PSU stocks. We have to change that perception.

Continue reading your story on the app

Continue reading your story in the magazine

MORE STORIES FROM BUSINESS TODAYView All

Lessons From Wistron

Labour trouble at the plant calls for introspection on the right balance between reforms and Licence Raj

6 mins read
Business Today
January 24, 2021

Hope and Despair

Corporate Leaders Expect Economic Recovery To Take Over A Year As The Pandemic Continues To Affect Businesses, Finds The Latest Business Today’s Business Confidence Index Survey

4 mins read
Business Today
January 24, 2021

Mehta's Fitness Regime

PEAK OF THE COVID-19 LOCKDOWN STILL MAINTAINING FITNESS

1 min read
Business Today
January 24, 2021

The FAB Challenge

LACK OF SEMICONDUCTOR MANUFACTURING IS TURNING OUT TO BE THE BIGGEST HURDLE IN INDIA’S TRYST WITH SELF-RELIANCE IN ELECTRONICS. IT REQUIRES ‘OUT OF THE BOX’ THINKING BY GOVERNMENT AND INDUSTRY

10 mins read
Business Today
January 24, 2021

Hyperlocals At Crossroads

The local delivery boom as a result of the lockdown seems to be tapering off

10+ mins read
Business Today
January 24, 2021

IN 2022, THE TELECOM NETWORK WILL START TO SHIFT INTO SPACE”

It’s been a bloodbath in the Indian telecommunications sector but Sunil Bharti Mittal, Founder and Chairman, Bharti Enterprises, put up a formidable fight. In a tell-all conversation with India Today Group Editorial Director Raj Chengappa and Deputy Editor Shwweta Punj, Mittal talks about how the pricing war unleashed by Reliance Jio is badgering the sector; how Bharti Airtel is inching back into the saddle of profitability and why Budget 2021/22 should focus on those at the margins and not on corporate tax cuts.

7 mins read
Business Today
January 24, 2021

Bulls to Rule For Now

EQUITY MARKETS ARE ENTERING THE NEW YEAR WITH HOPE. HERE’S WHAT LIES AHEAD

8 mins read
Business Today
January 24, 2021

Best Advice I Ever Got

“ADVERSITY BRINGS OPPORTUNITY, BUT WE OFTEN NEED HELP IN FINDING IT”

1 min read
Business Today
January 24, 2021

Pre-Budget Roundtable: The Growth Recipe

How the FM can make it a ‘never before’ Budget. Top experts weigh in

10+ mins read
Business Today
January 24, 2021

Indian Stock Markets Are Overheated

Most economic data points and indicators show that Indian Stock Markets are overheated

7 mins read
Business Today
January 24, 2021
RELATED STORIES

Cottage Style for a Kitchen

Nostalgic details belie the room’s efficiency and storage capacity.

2 mins read
Old House Journal
December 2020

Dave Koz & Friends

Summer Horns Tour

4 mins read
Smooth Jazz Magazine
September - October 2019

बीपीसीएल निजीकरण: 3-4 बोलियां मिली

रिलायंस, अरामको, बीपी, टोटल जैसी कोई बड़ी कंपनी दौड़ में नहीं

1 min read
Samagya
November 17, 2020

बीपीसीएल की दौड़ में कई फर्मे

अभिरुचि पत्र जमा कराने के अंतिम दिन कम से कम तीन से चार कंपनियों ने सौंपे पत्र

1 min read
Business Standard - Hindi
November 17, 2020

बीपीसीएल निजीकरण: सोमवार को बंद होगी बोली, सभी निगाहें रिलायंस पर

भारत पेट्रोलियम कॉरपोरेशन लिमिटेड (बीपीसीएल) के निजीकरण के लिए प्रारंभिक बोलियां सोमवार को बंद हो जाएंगी और ऐसे संकेत हैं कि ब्रिटेन की बीपी, फांस की टोटल और सउदी अरामको जैसी बड़ी कंपनियों के बोली लगाने की संभावना नहीं लगती है।

1 min read
Rokthok Lekhani
November 16, 2020

REGULATE MEDICAL AESTHETICS

The market that is worth billions of dollars in India has witnessed significant growth in the demand for aesthetic procedures owing to the rise in the number of doctors and surgeons providing effective medical aesthetic treatments and the launch of technologically advanced products for the same. However, India lacks proper guidelines to regulate the use of specific products and procedures for aesthetic treatment.

10+ mins read
Bio Spectrum
November 2020

10 inventos que salieron mal

Unos de entrada fuero un exitazo, pero luego se comprobaron sus efectos adversos y cayeron en el descrédito y el olvido. Otros enseñaron sus inconvenientes desde el primer momento, y unos más llegarían a causar la muerte de sus inventores.

7 mins read
Muy Interesante México
Noviembre - 2020

Party Time For Proud Beachboys

Concord Rangers recovered from an early deficit to create history with a first-ever FA Trophy final place at Wembley – but it was just a shame no-one was there to witness it.

2 mins read
The Non-League Football Paper
September 06, 2020

LEADING URBAN DESIGN ARCHITECT ON INTEGRATED DEVELOPMENT

TO BUILD spoke to Guy Briggs, Partner and Head of Urban Design at dhk Architects, about a new project in the integrated/mixed-use space.

5 mins read
To Build
Volume 10 / Issue 2 July - October 2020

कोरोना का लॉकडाउन नहीं आया होता तो अब तक बिक जाता बीपीसीएल

मैं देश को बिकने नहीं दूंगा-मोदी बीपीसीएल की हिस्सेदारी बेचने के लिए बुलाया ऑफर

1 min read
Rising Indore
July 01, 2020