Air India steers clear of flotation

New Delhi: State-run Air India has joined other top PSUs in deferring initial public offers (IPOs) because of the meltdown in the stock markets.
Other state-owned firms likely to defer their IPOs include NHPC, Oil India, Bharat Sanchar Nigam Ltd (BSNL), Coal India, RITES, State Bank of India (follow-on offer) and Ircon International, according to senior officials.
However, stock markets are demanding public floats by blue-chip PSUs to revive the interest of retail investors.
Analysts referred to the Maruti issue in 2002, which the government successfully held at a time of a downturn.
Chambers, too, are rooting for IPOs by state entities. Assocham president Sajjan Jindal has asked the government to push for such issues.
The government had looked to earn up to Rs 25,000 crore in the current financial year by divesting small stakes in state-run companies, according to finance ministry officials.
Its aim was to raise money to shovel cash into social sector projects and revive sick PSUs.
Besides the Air India issue, the officials said, the government was also banking on the BSNL and NHPC issues.
23/11/08 Jayanta ROy Chowdhury & R Suryamurthy/The Telegraph

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Categories: NACIL Nov 2008