The government has been struggling to meet its divestment target of Rs 80,000 crore after the failed Air India privatization plan
The government could divest at least 5 percent of their stake in Coal India this fiscal year, which could generate about Rs 88 billion, Business Standard reports.
The stake sale is likely to take place in the second half of FY2018-19, the report said.
Moneycontrol could not independently verify the news.
The government has set a divestment target of Rs 80,000 crore (Rs 800 billion) for the financial year 2018-2019. The government has been struggling to meet this target after the failed Air India privatization plan.
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The government, which currently owns 78.3 percent of Coal India, will transfer their stake to a Special National Investment Fund (SNIF) where PSU stakes are parked.
The SNIF can later sell the PSU stake. The SNIF has been set up so that the government can sell their stake in companies where they stake is more than 75 percent.
The government’s stake in Coal India will reduce to 73.8 percent after the divestment.
“It is this stake that will be divested through the exchanges later this year,” a government official told Business Standard.
The government has a deadline of August 22 to slash its stake in PSUs to 75 percent or below.
Apart from the Air India disinvestment, the government scrapped the merger of three insurance companies - National Insurance, Oriental Insurance and United India Insurance.
Apart from the Coal India stake sale, there are no other major divestment plans likely to take place in the near future.