The government is likely to seek expression of interest for strategic divestment of Container Corporation of India by end of the month, as it pushes forward with its disinvestment drive in the ongoing financial year.
Potential bidders will be invited for purchasing about 30% stake in the public sector enterprise after the railways ministry brings out policy for land leasing, which has been the key issue holding back the initiation of divestment process.
“EoIs should come by the month end… Once the land leasing policy is brought out by railways, we will go ahead,” an official said, asking not to be named.
The official added that the railways ministry was close to finalising the policy which will reduce the lease rates by a half and extend the leasing period to long-term basis instead of short term.
“The leasing rate is being planned to be brought down to 3% and the leasing period will have to be made 30-35 years to make it attractive (for potential buyers),” the official added.
The leasing policy will require approval from the Cabinet which, if delayed, could well push the disinvestment process into the next financial year.
Typically, the Department of Investment and Public Asset Management (DIPAM), which is the nodal body undertaking divestment of public sector enterprises, gives about a month’s time or more for bidders to put in their bids. In certain cases such as Air India and Bharat Petroleum Corp Ltd, the government had given extensions due to the Covid-19 pandemic.
In case of Concor, the Cabinet Committee on Economic Affairs had given in-principle approval for strategic divestment in November last year. Shares of Concor closed at Rs 415.3 on the Bombay Stock Exchange on Tuesday, up 0.56%.
The government has set a target of Rs 2.1 lakh crore through disinvestment for the financial year ending March 2021. The current proceeds stand at Rs 27,577 crore, of which Rs 13,844 crore has come from disinvestment, Rs 13,733 crore from dividend receipts.
