Centre Likely to Sell Stakes in BHEL and Two Others

The central government is likely to consider Bharat Heavy Electricals Ltd (BHEL), Mecon Ltd and Andrew Yule and Co. Ltd for the next round of disinvestment. The main agenda behind the stake sales in the three companies is to raise funds via asset sales for the next fiscal and overcome the tepid progress made so far this year. According to a report byMint, Rs 1.75 trillion is expected to be collected by the government from the disinvestment receipts next fiscal. The government has been missing its disinvestment targets and disinvestment goal of the Rs 2.1 trillion for this fiscal.

As on January 20, the centre has been able to raise only Rs 15,220 crore. The push-in privatisation of Air India Ltd and Bharat Petroleum Corp. Ltd (BPCL) to next year is one of the reasons for the decrease in the collection.

Reports on the plan have recently been submitted by SBI Capital Markets Ltd, which is the adviser to the proposed stake sale in India’s largest power equipment maker, to the department of investment and public asset management (DIPAM). The report will enable the government to decide on whether to go ahead with the stake sale or not and also to decide the amount at which it will be sold.

DIPAM is also being advised by SBI Capital on the proposed stake sales in Mecon and Andrew Yule.

However, according to the Mint report, a BHEL spokesperson, in an emailed response, said that as per his knowledge there is no information on BHEL’s disinvestment at this juncture.

BHEL is one of the ten 10 Maharatna CPSEs in which the central government holds a 63.17 percent stake. The company also accounts for 53 percent of India’s installed power generation capacity in the conventional space, producing the entire range of power plant equipment ranging from thermal, gas, hydro and nuclear power projects.

BHEL has 16 manufacturing units and around 33,500 staff, and as of the September Quarter the company had orders worth Rs 1.1 trillion.

Mecon Ltd falls under the steel ministry and is present in the metals and mining space while, Andrew Yule is present in diverse businesses such as tea, electrical, engineering, lubricant and printing.

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