Cold response to NTPC offer gives govt jitters

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The government’s ambitious disinvestment programme may fall short of its expectations and be inadequate to bridge the mounting fiscal deficit. After receiving lukewarm response to the much-anticipated public issue of the state-run power major NTPC, the government is thinking of revising its strategy.

Disinvestment Secretary Sumit Bose today called a meeting of his department’s officials to discuss the response to NTPC’s follow-on public offer. It could manage a subscription of just 1.2 times on its closing day. They are also understood to have discussed NMDC follow-on offer, which is likely to be launched in the second week of March.

Sliding revenue receipts and spiraling expenditure compelled the Ministry of Finance to pin all its hopes on the proceeds from disinvestments of public sector undertakings (PSUs) and the auction of 3G wireless spectrum. While the PSU disinvestments may not yield the desired results as markets show weakness, the 3G auction could be postponed for the next financial year.

This entry was posted on Sunday, February 7th, 2010 at 12:38 am and is filed under IPO-FPO-NFO, Indian Economy, Indian Stock Markets, Indian Stocks. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.