The government is likely to take the auction route for selling 10% of its stake in Hindustan Cooper, company's CMD Shakeel Ahmed said today.
"There will be 10% stake sale by the government in one tranche. The Department of Disinvestment will decide the date. The disinvestment is likely to be done through the auction route, though there has to be final view," he told reporters at the Delhi Investment Summit on Afghanistan here.
The government used the auction route for the first time in ONGC stake sale to institutional buyers. Market regulator SEBI introduced the route last February to facilitate promoters to offload holdings in listed companies.
The finance ministry had earlier indicated that it would prefer the route, which saves time and cost for selling stakes in eligible companies. The government has set a target of raising Rs 30,000 crore through stake sale in state-run firms this fiscal.
Ahmed said there would be no fresh equity sales in the process and it is only government's stake which would be sold in the process.
"We are hoping that a revised proposal would be approved by the Cabinet Committee of Economic Affairs very soon. The Cabinet note has been circulated. Everything is in place. I believe the proposal would be approved in the next Cabinet meeting or in the next to next," Ahmed said.
However, he said that it is immediately not possible to ascertain the amount that could be raised by 10% stake sale in the company.
"This will be known after the Group of Ministers take a call on the price," he added.
Meanwhile, Ahmed said HCL may raise up to Rs 1,250 crore through external commercial borrowing (ECB) over the next five years including Rs 250 crore in the current fiscal.
"We are still discussing on the issue of raising funds through the ECB route. We will take a call shortly," he said.
