look news india
Mumbai: Fresh buying in public sector undertaking (PSU) stocks following the June 4 Lok Sabha election results has added Rs 12 lakh crore in market capitalisation to PSU stocks in a little over a month.
A research firm report said that the market value of these shares has increased by Rs 22.50 lakh crore till 2024.
The central government is working on a strategy to get additional work done for its infrastructure projects through public sector undertakings, as a result of which the shares of government companies in railways, ports, road construction, defense sector have been seeing a lot of attraction in the recent past.
However, given the high prices, the government may also sell its stake in public sector undertakings, in which case the price hike could be put on hold, the report said.
The government may sell part of some of its undertakings to strengthen its balance sheet.
It is expected that the Modi government will continue its policies of the last ten years, due to which prices are increasing. In the last fortnight, the share prices of companies including Rail Vikas, SCI, MTNL, RailTel have seen an increase of 20 to 50 percent.
The government held more than 75 per cent stake in ten listed undertakings at the end of March 31 last fiscal.
According to the minimum public shareholding rules, no promoter can hold more than 75 per cent stake in his company. If this rule is followed, the government can raise Rs 3 lakh crore at current prices.
Public shareholding in five of the 12 public sector banks is still below the 25 percent benchmark. The deadline for increasing public holding in these banks is August of the current year.
In the last financial year, the government had set a disinvestment target of Rs 51,000 crore, but later it was reduced to Rs 30,000 crore.
