SELLOFF TARGET SURPASSED! The government's divestment initiative got off to a flying start in 2004, with its decision to sell its stake in six public sector undertakings receiving huge response from the investors.
IPCL, CMC Ltd, IBP Ltd, Dredging Corporation of India, ONGC and Gail were the companies which took the public route in 2004. To the delight of the divestment ministry, the sale of government's stake in the PSUs helped it surpass the selloff target by almost Rs 900 crore (Rs 9 billion), as it mopped up Rs 15,400 crore (Rs 154 billion) for the fiscal.
The success of the public issues proved that the divestment drive could still proceed well even without adopting the strategic sales route. The IPOs ensured that even small investors could buy into big public companies. The IPOs also breathed life into the primary market.
The Centre sold its residual stakes in IPCL, CMC and IBP and offloaded 10 per cent stake each in Oil and Natural Gas Corporation, and Gas Authority of India Ltd. The government divested 20 per cent stake in Dredging Corporation.
Let us take a look at the progression of these public offers and a brief profile of the six blue-chip companies.