CCEA likely to discuss BHEL stake sale issue today

The government currently owns 67.72 per cent stake in the power equipment manufacturer.

The Cabinet Committee on Economic Affairs (CCEA) is expected to take up a proposal for disinvesting 5 per cent stake in the state-run Bharat Heavy Electricals Ltd (BHEL) on Tuesday. The government currently owns 67.72 per cent stake in the power equipment manufacturer.

The stake sale is expected to fetch about Rs 4,500 crore and will help the government meet its ambitious target of Rs 40,000 crore from disinvestment proceeds in the current fiscal.

As part of the follow-on public offer,10 per cent of the equity to be offloaded would be reserved for employees.

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The government will also provide a discount to retail investors as well as eligible employees under the employee reservation portion.

BHELs board had cleared the plan in May but had left the decision on the time line to the government. Though the government has appointed four merchant bankers Morgan Stanley,DSP Merrill Lynch (Bank of America),ICICI Securities and Kotak Mahindra Capital for the FPO; it is yet to decide on its time schedule.

Apart from BHEL,the government is also planning stake sales in Steel Authority of India Ltd,ONGC NBCC,Hindustan Copper,Rashtriya Ispat Nigam Ltd and MMTC Ltd in the current fiscal but volatile market conditions have proved to be a dampener.