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The government can garner over Rs 3.76 lakh crore by bringing down its holding in state-owned companies to 51 per cent, says ICICI Securities’ White Paper on disinvestment.
“There is huge potential to disinvest most of the holdings while retaining the 51 per cent government stake.
This can lead to unlocking the wealth to about Rs 3,76,711 crore,” said the White Paper, which was released by Finance Minister Mr Pranab Mukherjee.
The total market capitalisation of public sector units is around Rs 12.83 lakh crore, according to the Paper.
A sectoral analysis shows that the value of government stake is the largest in power sector, followed by oil and gas and metals.
The value of government stake in power companies stood at Rs 4.03 lakh crore, oil and gas companies (Rs 2.98 lakh crore) and metals (Rs 1.70 lakh crore). The valuation of government stake in engineering sector companies stood at Rs 85,791 crore, the paper noted.
“Experience in other countries indicates that resource mobilisation equivalent to 5—10 per cent of GDP successfully augmented fiscal position and catalysed economic growth while maintaining a desirable and acceptable social thrust,” the Paper said.
Releasing the Paper, Mukherjee had said that disinvestment was necessary to unlock the value of state—owned companies and garner resources for funding social sector programmes.
“Keeping more than 51 per cent equity in Government companies locked—up does not make economic sense when such valuable resources are required for redeployment in area where development is needed,” he had said.
With seven months of the ongoing financial year (2011-12) already over, the government has been able to raise just Rs 1,145 crore through stake sale in Power Finance Corporation (PFC) and there are apprehensions that it may miss the mammoth Rs 40,000 crore target for the fiscal.
Volatile stock markets have forced the government to delay the proposed stake sales in PSUs. Global equity markets have been on a downslide on fears over the spiralling debt crisis in the euro zone, as well as credit crunch in the US.
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