(a) whether several Public Sector Undertakings (PSUs) propose to issue Initial Public Offer (IPO) during the current year;
(b) if so, the details thereof, PSU-wise;
(c) the manner in which this IPO propose to help these companies;
(d) whether the disinvestment propose to accelerate the growth of these companies;
(e) if so, the details thereof?
THE MINISTER OF HEAVY INDUSTRIES & PUBLIC ENTERPRISES (SHRI PRAFUL PATEL)
(a): The disinvestment policy inter alia envisages that all Central Public Sector Enterprises (CPSEs) having positive
networth, no accumulated losses having earned net profit for 3 preceding consecutive years, are to be listed through
public offerings out of Government shareholding or issue of fresh equity by the Company or a combination of both.
(b): In pursuance of this policy the Department of Disinvestment (DoD) is in dialogue with the Administrative Ministries
and the CPSEs to assess their capital expenditure requirements to be raised through issue of fresh equity.
At present the process of listing through an Initial Public Offer (IPO) in Rashtriya Ispat Nigam Limited and National
Building and Construction Corporation Limited by way of offer for sale of 10 percent paid-up equity capital of each of
the Company is being pursued by the DoD.
(c): Listing of shares is advantageous to the CPSEs as well as the shareholders. It promotes transparency due to higher levels
of mandatory disclosure and oversight, due diligence, and also enhances the quality of corporate governance in various
ways including that of induction of Independent Directors. The management also feels encouraged to perform better to
meet the shareholder expectations, thereby unlocking the intrinsic potential of the company and bringing out its true
value in public domain and consequential goodwill for the company.
(d) & (e): The true value of the enterprise would be known after listing of the shares on the stock exchanges as a result
of which the market capitalization of the Companies is expected to increase. This would help the Companies to raise
resources, if required.