Cabinet Committee could discuss SAIL share sale proposal on July 19

The Cabinet Committee on Economic Affairs (CCEA) on Thursday is expected to consider a proposal for disinvesting government's 10.82 per cent stake in Steel Authority of India (SAIL).



SAIL's share sale is proposed to be conducted through auction route or offer for sale and is expected to garner Rs 4,000 crore to the government kitty.

The proposal, mooted by the Department of Disinvestment, was deferred in the last meeting of CCEA as Steel Minister Beni Prasad Verma and Steel Secretary D R S Chaudhary were not in the city.

However, the Disinvestment Department has not fixed any particular time frame for the SAIL's stake sale as its timing will depend on market conditions, the sources added.

The government currently holds 85.82 per cent stake in SAIL.

Since the beginning of this financial year, SAIL's shares have gone down by over 4 per cent, while both BSE benchmark Sensex and National Stock Exchange index Nifty have declined by over 2 per cent.

The poor market conditions have played spoilsport for the government to launch the disinvestment programme for the current fiscal, although it aims to raise Rs 30,000 crore by selling stakes in the public sector firms.

Few days back, it had to put on hold the initial public offer (IPO) of Rashtriya Ispat Nigam Ltd (RINL) due to volatility in the markets and lukewarm response of prospective investors in the roadshows held last week.

The RINL IPO, in which the government has proposed to divest its 10 per cent stake, was supposed to kickstart this year's share sale programme of the government.

Hindustan Aeronautics, BHEL, National Aluminium Company (Nalco), Hindustan Copper and Oil India are some of the other PSUs which are on government's disinvestment radar this year.

Poor market conditions had spoiled government's disinvestment programme last year as well. Against a target of raising Rs 40,000 crore through PSU's stake sale in the last fiscal, the government could mop up only Rs 14,000 crore.

with inputs from PTI