After Air India, These 8 PSUs Will Be Sold To Private Firms This Year (BPCL, IDBI & More)

Strategic disinvestment process for multiple PSUs is going on in parallel.

Now that the Air India privatisation process is completed, the government has shifted attention towards the sale process of BPCL.

DIPAM secretary Tuhin Kanta Pandey said that the strategic disinvestment process for BPCL, BEML, Pawan Hans and Shipping Corporation are “all going on in parallel”.

LIC IPO

It is also keeping watch on the upcoming LIC IPO.

It is looking to file the draft red herring prospectus (DRHP) for LIC with SEBI within December-January period.

Set to be the largest ever IPO in India, it is expected to take place in March 2022.

Process Timeline

Pandey expressed hopes of materialising a couple of big-ticket transactions by March 31, 2022.

It takes about a year from the date of issue of Expression of Interest (EoI) for the conclusion of any strategic sale.

BPCL

One of them is Bharat Petroleum Corporation Limited (BPCL) for which plans are being made to invite financial bids by December.

Currently, the due diligence process is going on.

Multiple bidders including Vedanta, Apollo Global Management and Think Gas showed interest in its buyout.

The market value of the Centre’s 52.98% stake in BPCL is a little over Rs 52,200 crore at the current market prices (October 11, 2021).

Disinvestment Target

Both BPCL privatisation and LIC IPO are crucial if the government is to meet its FY22 disinvestment target of Rs 1.75 lakh crore.

So far, it has raised about Rs 9,110 crore by selling a stake in Axis Bank, NMDC Ltd, Housing and Urban Development Corp (HUDCO), and Hindustan Copper.

Other PSUs In Privatisation Pipeline

Other CPSEs (Central Public Sector Enterprises) in the pipeline for privatisation include Central Electronics Ltd, BEML, Shipping Corp of India, Neelachal Ispat Nigam Ltd, and Pawan Hans in the current fiscal ending March 2022.

For the Central Electronics Ltd sale, the government has reached the financial bids stage.

With the others, due diligence is ongoing.

After that is complete, the government will issue the request for proposal for financial bids.

Industrial Development Bank of India (IDBI)

The expression of interest (EoI) for IDBI Bank should be out by December.

After that, it will take nine months to one year to complete the transaction.

IDBI is a development finance institution and a wholly-owned subsidiary of Life Insurance Corporation (LIC).

Concor Not Happening 

Container Corporation of India (Concor) was also going to be in the list but its strategic sale will not happen in the current fiscal.

This is because the post privatisation rail land usage policy is yet to be finalised by its owner, the Ministry of Railways.

Hence, the EoI could not be issued.

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