Aiming high

New Delhi, March 3: The finance ministry has set an unofficial target of collecting Rs 10,000-12,000 crore from divestment in the next fiscal, most of it from the sale of small stakes in blue-chip PSUs.

Top North Block officials said they hoped to garner the amount from about six to eight public issues: the blockbuster flotation will be a 5 per cent stake sale in ONGC.

Officials estimate that even selling the stake at a 10 per cent discount to the market price could fetch them a cool Rs 6,000 crore. ?It will be big ticket sale,? officials said.

As the money is to be parked in the National Investment Fund from which social sector projects and revival of sick PSUs is to be funded, the Left is expected to be more pliant in letting the stake sales through.

Left leaders say they would take a stand on the stake sales depending on whether the sale amounted to a ?creeping disinvestment? through repeated sale of shares of the same PSU in the market.

The Left has in meetings with the Prime Minister also made it clear that it would insist on the government coming out with a good logic for a PSU coming to the market. If these criteria are met, the Left seems to have decided not to stop the government from going ahead with these plans.

For the government, which is hard pressed to find money for the ambitious social sector programmes, it has announced that the ?outside the budget help? from the stock offerings would come as a manna for which they would only be too willing to go the extra mile to satisfy the Left.

Besides ONGC, the metal sector is likely to be represented by Nalco and the power sector by Power Finance Corporation and PowerGrid. In the engineering sector, the government intends to sell a part of its stake in Bhel. It could also offload a part of the residual stake it holds in Maruti Udyog.

The government holds about 74.14 per cent in ONGC directly and another 14.4 per cent through three state-run firms ? IOC, Gail and LIC. Despite a small offering in the retail market, the government will retain an overwhelming control of the oil sector company both directly and indirectly.

North Block does not expect such sales to raise the political temperature in relations between the Congress government and its Left allies.

With the metal sector booming, the government also wants to take Nalco to the market with a small stake sale to retail investors.

An earlier bid two and a half year ago by the BJP-led government to sell a strategic stake in Nalco was scuttled by Orissa chief minister Naveen Patnaik. But this time round a small retail stake sale of 5 to 10 per cent stake in the domestic market is not expected to raise hackles.

The BJP cabinet in its salad days had even cleared a 10 per cent initial public offering in the domestic market which could be followed by a 20 per cent offering in the global market through an ADR/GDR issue.

With a market capitalisation of Rs 1,1092 crore, a 10 per cent stake sale would fetch the government a rough Rs 1,000 crore income. Similarly, a 5 per cent stake sale in Bhel and a 8 per cent remainder holding in Maruti to the market is expected to get the government another Rs 1,600 crore.