In a recent development, the Indian government has announced its intention to sell up to a 4.92% stake in the utility company SJVN Ltd, as disclosed in a stock exchange filing on Wednesday. This stake sale plan includes the option to sell 2.46% if the demand exceeds expectations.
The floor price for this stake sale has been fixed at 69 rupees, representing a significant 15.6% discount compared to the closing price of SJVN Ltd’s stock on Wednesday. Currently, the federal government holds a majority stake of 59.92% in this state-run hydropower generation company, while the northern state of Himachal Pradesh possesses a 26.85% stake.
The anticipated proceeds from this sale of the federal government’s 4.92% stake in the state-run hydro power generation firm are estimated to be around 13.34 billion rupees. This move is part of the Indian government’s ongoing efforts to meet its fiscal targets, having raised 56 billion rupees through stake sales in state-run entities in the fiscal year 2023/24, against a target of 510 billion rupees.
Moreover, the SJVN stake sale aligns with the capital market regulator’s requirement for minimum public shareholding, as stated in the exchange filing. This move underscores the government’s commitment to fiscal discipline and achieving its financial objectives in the energy sector.