The government is targeting to conclude the strategic sale of BPCL in the June quarter, Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said on Thursday. "I think we are targeting the first quarter (of 2021-22 fiscal). The engagement is intense now, it is at the due diligence stage. Our process is of value maximisation, and we have to take all precautions to see the value is maximised," Pandey said at an event organised by Aditya Birla Sun Life Mutual Fund.
The government has received three preliminary bids for buying of controlling stake in India's second-largest fuel retailer Bharat Petroleum Corp Ltd (BPCL). Mining-to-oil conglomerate Vedanta had in November confirmed putting in an expression of interest (EoI) for buying the government's 52.98 per cent stake in BPCL. The other two bidders are said to be global funds, one of them being Apollo Global Management.
Pandey said privatisation of public sector units is a difficult task. However, it will be achieved when private sector shows interest in brownfield acquisitions.
"As private sector interest revives through the slew of measures that the government has taken in terms of economy, the stimulus, the capex, we expect them to come and make disinvestment offerings one of the important aspects of their capital formation strategy which includes the brownfield assets which could be taken to new heights," he said.
Pandey said when the government invites EoIs for selling CPSEs, private sector too should show interest by placing bids.
"You need two hands to clap and if we have an offering, we also expect that the private sector interest is also coming forward to pick up those offerings," he said. The government has already invited bids for strategic sale of BPCL, Air India, Pawan Hans, BEML, Shipping Corp and Neelachal Ispat Nigam Ltd. Also, the process of sale of Vizag Steel or RINL has received Cabinet nod.
On the proposed initial public offering of Life Insurance Corp of India (LIC), Pandey said the government is yet to decide on the size of the stake to be sold.
For 2021-22, the government has set a disinvestment target of Rs 1.75 lakh crore, over five times what it is aiming to raise in the current financial year. In the Revised Estimates, the target has been set at Rs 32,000 crore for the current fiscal.