Cabinet okays 10% stake sale in Hudco

Approves price discount of up to 5% on the issue price to retail (small) investors and Hudco employees

The Cabinet Committee on Economic Affairs, on Wednesday, gave its nod to the second planned Initial Public Offering (IPO) of equity in state-owned companies for this financial year, with the approval of 10 per cent stake sale in Housing and Urban Development Corporation (Hudco).

It approved a price discount of up to five per cent on the issue price to retail (small) investors and Hudco employees. The actual discount will be fixed on the recommendations of a committee of officers.

The paid-up equity capital of Hudco, with a net worth of Rs 7,800 crore, was Rs 2,002 crore as on end-March 2015. The face value of each share is Rs 10 at present. To meet its ambitious stake sale target for 2016-17, the government is planning IPOs of equity in four public sector units and hopes to mop around Rs 8,000 crore.
 

The department of investment and public asset management has identified Hindustan Aeronautics and Rashtriya Ispat Nigam as the companies it wants to take public, apart from Hudco and Cochin Shipyard, preparation for which is well under way.

For 2016-17, the budgeted disinvestment target is Rs 56,500 crore, of which Rs 36,000 crore is expected through minority stake sales, including IPOs. The rest is expected from strategic sales, including of loss-making companies and asset sales.

Doctors

The Cabinet also formally approved a higher retirement age for doctors in government service, from the present 62 years to 65. There are about 4,000 doctors under the Central Health Service. Prime Minister Narendra Modi had earlier announced the decision.

Roads

CCEA also approved four to six-laning of the Kharar-Ludhiana highway section of 76 km in Punjab at an estimated cost of Rs 2,070 crore. It is presently a two-lane highway. It is to be completed in 30 months, under phase-V of the National Highways Development Project.

Of the total length 54 km will be widened to six-lane and the remaining 22 km to four-lane.

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OTHER DECISIONS

• Pact with Taiwan for cooperation in the field of agriculture and allied sectors;
   
• Nod to six international agreements, including one which will allow India to undertake exploration of high value mineral deposits at the seabed and another to improve air connectivity with Taiwan;
  

 

Bill to amend the debt recovery laws. It seeks to amend four legislations - Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act, 2002; the Recovery of Debts due to Banks and Financial Institutions Act, 1993; the Indian Stamp Act, 1899 and the Depositories Act, 1996.
 

Agreement between India and Saudi Arabia on labour cooperation.