With its tepid revenue growth resulting in greater reliance on non-tax revenue, the central government is likely to restart is divestment drive. People in the know have told CNBC-TV18 that the government may look at launching Offer For Sale (OFS) issues for Hindustan Aeronautics and Bharat Dynamics in the second quarter of this fiscal.

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The government may look at diluting approximately 15 percent stake in Hindustan Aeronautics through which it may look to raise around Rs 3,000 crore, according to sources. The government shareholding in Hindustan Aeronautics currently stands at 89.97 percent.

The government may also look at diluting 15-18 percent stake in Bharat Dynamics to raise approximately Rs 600-700 crore. The government shareholding in Bharat Dynamics currently stands at 87.75 percent.

It is further learnt that merchant bankers and legal advisors have already been appointed for both OFS issues and the work will start as soon as the nation-wide lockdown opens. Department of Investment and Public Asset Management (DIPAM), in January, had invited bids from merchant bankers who were interested in running the OFS issues for Hindustan Aeronautics and Bharat Dynamics.

Bharat Dynamics did not reply to CNBC-TV18’s query on the OFS issue whereas Hindustan Aeronautics said that DIPAM has planned an OFS issue for the company which includes a 15 percent equity dilution. The company added that the OFS issue is being launched to meet Minimum Public Shareholding norms by August 2020. Confirming CNBC-TV18’s story, Hindustan Aeronautics also said that merchant bankers and legal advisors for company’s OFS issue have been appointed.

First Published:May 7, 2020 12:38 PM IST