Despite reducing the divestment target to Rs 50,000 crore for FY23, the Indian government is expected to miss out on it. Hindustan Aeronotics Limited has reported a 23 per cent surge in profit for the October-December quarter.
Now the government is selling a 3.5 per cent stake in the firm for Rs 2,867 crore at a floor price of Rs 2,450.
HAL surging ahead
Hindustan Aeronotics Limited has recently bagged a Rs 32,000 crore order to supply marine choppers from the Indian defence ministry.
Its order book now stands at Rs 84,000 crore, with more worth Rs 50,000 crore in the pipeline.
How does it work?
The Offer is being undertaken by the government, for achieving the minimum public shareholding in a firm as per the norms.
A single bidder barring Mutual Funds and Insurers can't be allocated more than 25% of the offer shares.
HAL employees will also be eligible to apply for its shares of value up to Rs 2 lakh as part of the stake sale.
Need for divestment
The government had been planning to cut down its stake in one of the world's oldest aerospace manufacturers by 15 per cent as of 2021.
Its aim was to achieve a minimum public share holding of 75 per cent in the firm which has scripted a turnaround.
