Government is set to sell 10% stake in MIDHANI

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The government is planning to sell up to 10 per cent stake in defence PSU Mishra Dhatu Nigam Ltd (MIDHANI) in the current fiscal ending March, an official said. The company got listed on stock exchanges in April 2018 and the government had attracted approximately Rs 438 crore by making available 26 per cent stake through IPO.

Mishra Dhatu Nigam Limited, is a specialized metals and metal alloys manufacturing facility in India, located in Hyderabad, Telangana. It is a Public Sector Undertaking, under the administrative control of Department of Defence Production, Ministry of Defence, Government of India. So far this fiscal, the government has collected Rs 6,138 crore by selling minority stake in Hindustan Aeronautics Ltd and Bharat Dynamics Ltd through offer for sale so far this year. The government also divested 15.2 per cent in Mazagon Dock Shipbuilders Ltd through an initial public offering. The government has set a Rs 2.1 lakh crore disinvestment target in current fiscal. This includes Rs 1.20 lakh crore through CPSE stake dilution and Rs 90,000 crore through stake sale in financial institutions — more than four times what it raised last financial year.

The official said that with the lifting of regulations in space sector to foreign investment and bringing defence sector under automatic route for 74 per cent foreign direct investment (FDI), MIDHANI shares are expected to attract investors.”We are looking at up to 10 per cent stake dilution via offer for sale,” the official reported. Shares of MIDHANI closed at Rs 193.50 apiece on the BSE on Friday. At the current market price, the government can create a capital of about Rs 360 crore by selling 10 per cent stake in the company. The official further said that with big ticket divestment plans hit by the COVID-19 pandemic, government is readying public sector companies for minority stake sale in the remaining months of current fiscal.