New Delhi, May 5
The government’s disinvestment plan for IDBI Bank, as part of the broader strategy to monetise assets through stake sales during the current financial year, is progressing in accordance with the normal schedule, the Department of Investment and Public Asset Management Secretary Arunish Chawla has said.
"The focus remains on steady execution and long-term value creation, even as global economic conditions remain uncertain," Chawla told NDTV Profit in an exclusive interview.
The Centre and the Life Insurance Corporation of India (LIC) plan to jointly offload a 60.72 per cent stake in IDBI Bank, which comprises 30.48 per cent held by the government and a 30.24 per cent share by the insurance giant.
Chawla said that the government aims to meet regulatory norms through structured divestments in public sector banks and central public sector enterprises.
He also said efforts to monetise land and infrastructure assets of MTNL were continuing and confirmed that a flexible approach was being adopted to meet minimum public shareholding targets.
Chawla said that asset sales will be carried out in a phased and market-sensitive manner. He noted that multiple bids have already come in for key transactions, including public sector bank stake sales, and that due diligence is progressing on the IDBI Bank transaction.
The government has also extended deadlines for some companies, that have been lined up for disinvestment, to comply with the Securities and Exchange Board of India's (SEBI) public float rules, he said.
The DIPAM Secretary said the stake sale in IDBI Bank is proceeding as planned and is not affected by broader macroeconomic shocks. He described it as a strategic sale taking place through a multi-stage and multi-layered process.
"A data room has been set up, and due diligence has been completed. Negotiations on the share purchase agreement are currently underway,†he said.
On the issue of further stake dilution in LIC, Chawla said the government aims to meet the minimum public shareholding requirement by the financial year ending March 2027, in line with the SEBI’s norms.
The government plans to conduct small but regular offers for sale, keeping liquidity and retail investors in mind, he said.
This has also been the policy in the past as well, as any large offloading of shares tends to depress share prices. The capacity of the market to absorb shares has to be kept in mind as part of any prudent stake sale, according to market analysts.
For the financial year 2025-26, the Centre has set a disinvestment and asset monetisation target of Rs 47,000 crore.
— IANS
Reader Comments
Finally some progress on IDBI Bank disinvestment! The government needs to move faster on these PSU reforms. Too much taxpayer money is locked in inefficient banks. Hope they get good valuation 🤞
As a small investor, I'm concerned about LIC reducing stake. They've been our most trusted insurance provider for generations. Hope this doesn't affect policyholder interests. Government should clarify safeguards.
Rs 47,000 crore target seems ambitious given global uncertainties. But gradual OFS route makes sense - we saw what happened with LIC IPO when they rushed it. Slow and steady wins the race! 🚀
Why is government selling profitable assets like IDBI Bank? This looks like short-term gain for long-term pain. We should strengthen our PSUs instead of selling family silver. Remember Air India sale - no visible benefits to public.
Good move if it brings more efficiency to banking sector. But government must ensure Indian control remains - we don't want foreign players taking over our financial institutions. Jai Hind! 🇮🇳
Hope they use the disinvestment money wisely - should go into infrastructure and education, not just to fill budget gaps. Transparency in utilization is key. #AccountabilityMatters
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