Disinvestment of government’s 10.82 per cent stake in SAIL will happen soon, a top official said wooing the investors here seeking their participation in the issue.
“The Finance Ministry is expected to decide on a date soon on divesting 10 per cent in SAIL. It will happen soon,” Steel Secretary D R S Chaudhary said addressing an investors’ forum to highlight the potential of the Indian steel industry.
“We have a plan to divest SAIL in the short-term. So, it is necessary to engage the investing community, try to ensure that they have a holistic picture of the steel sector, rather than reading from the media,” he added.
Selling stake in large public sector companies is a central plank of the government’s plan to bring down a wide fiscal deficit and it is looking at ways to attract investors.
Stake sale in SAIL will fetch the government an estimated Rs 4,000 crore.
The Cabinet Committee on Economic Affairs had in July last year approved 10.82 per cent disinvestment in SAIL out of Government’s 85.82 per cent shareholding through the Offer of Sale (OFS) route.
However, it could not be taken forward amidst the subdued market conditions. The government has kept the issue on hold anticipating buoyancy in the market to return.
The ongoing rally in the Dalal Street may prompt the government to bring the issue back to the table for meeting its Rs 30,000 crore disinvestment target for the current fiscal.
Chaudhary is here on a three-day visit, ending today, to highlight the Indian steel sector’s potential among the vibrant investment community in the island nation.
Leading a delegation which comprises officials of both public and private firms, he is scheduled to hold a series of meetings with including Singapore government’s investment arms — Temasek Group and Government Investment Corporation of Singapore (GICS).
India’s steel-making capacity, which currently stands at around 90 million tonnes per annum (mtpa), is projected to grow to 200 mtpa by 2020, calling for an investment of $ 110 billion in the next six-seven years. However, they face a fund crunch to carry their plans forward.
Wooing investors, Chaudhary said the Indian steel sector has grown by 5 per cent last year compared to 1.2-1.4 per cent recorded by the global industry.
“So it is important to talk to them (investors) directly to be able to understand what their concerns are and be able to address those concerns,” he added.
Chaudhary said a steel industry investment promotion delegation would also visit investors in Hong Kong, and major investment centres in Europe and the US at later dates.