SAWT BEIRUT INTERNATIONAL

| 10 December 2023, Sunday |

Indian government plans stake sale in Indian Railways’ funding arm

Two government officials told Reuters on Wednesday that the Indian government is contemplating selling part of its stock in the state-owned Indian Railway Finance Corp (IRFC) (INID.NS) in order to reach its divestment plans for the year.

The government owns little more than 86% of Indian Railways’ financial arm.

“The stake sale would take place soon,” a government official said, adding that, while the government has yet to decide on the precise amount to sell, it will try to sell up to 11% in numerous tranches.

Last month, the government sold a more-than-5% stake in another state-run railways company, Rail Vikas Nigam, raising 13.66 billion rupees ($164.34 million).

So far in fiscal 2024, it has raised 56 billion rupees against a target of 510 billion rupees.

The Ministry of Finance did not immediately respond to a Reuters request for comment.

The sale would also have the added advantage of the government adhering to the regulator-mandated minimum public shareholding norms, which requires that public companies maintain at least 25% public shareholding.

While state-run firms have greater leeway in this regard, the government intends to bring down its shareholding in line with the norms.

Shares of IRFC have gained 58% over the last four weeks. The stock was trading at 51.55 rupees per share at 01.42 p.m. IST on Wednesday, up 1%.

    Source:
  • Reuters