PSU GICs' IPOs: Will the government offload stakes in tranches?
Shital Jibhe / 20 Jan 2017
The Ministry of Finance has announced that it intends to offload the stakes of the five state-owned general insurance companies (GICs). The five government-owned GICs are set to offload 25 per cent of their stakes.
The Ministry of Finance has announced that it intends to offload the stakes of the five state-owned general insurance companies (GICs).
The five government-owned GICs are set to offload 25 per cent of their stakes. However, there is no clarity on whether the government plans to offload the stakes at one go or in tranches. It is felt that the government may prefer to sell the stake in small tranches. If that happens, the government come may offer 10 per cent stake sale in the first tranche.
However, the trade unions may strongly object to the government's divestment plans, in which case, the government may go in for fresh issue of equity capital for all five public sector insurance companies, viz., New India Assurance Co Ltd, United India Insurance Co Ltd, Oriental Insurance Co Ltd, National Insurance Co Ltd and General Insurance Corporation of India.
All the five PSU GICs are well-capitalised and may attract investors' interest once their issues hit the markets.
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