While there cannot be any second thought on disinvestment in PSUs to reduce the borrowings by Government, it is more necessary to find the right valuations. There cannot be a single formula for all the PSUs.
The units under stress like BSNL and Air India have huge asset bank, both physical in form of land, buildings, towers etc. and soft assets like licenses, spectrum etc. If the assets are bifurcated among separate subsidiaries, it can fetch a better value than the combined entity.
On the other hand, Maharatna companies like SAIL, Coal India, NTPC are struggling because they cannot expand in absence of sufficient cash. These companies should be allowed to raise funds from the market by issuing fresh equity. Finding buyers for these large companies for strategic sale will be difficult if not impossible. Any apprehension about Govt. holding going below 50% should be ignored. These companies can grow much faster if there shackles are withdrawn. We have the example of ICICI and HDFC. The valuations of Government holding in these companies will rise manifold.
The same logic can be applied to companies like Concor, SCI etc. before going for strategic sale.
There is general apprehension that bunching of too many IPOs and FPOs will affect the market appetite. But it can also be argued that better intentions of the Govt. to combat the crisis will improve the sentiments and will bring more funds to market.
If need be, a separate income tax exemption on the line of NPS (but with shorter maturity period of five or ten years) can be offered to all tax payers.
No comments:
Post a Comment