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FinMin plans stake sale in HUDCO
New Delhi: In line with its plans to encourage listing among public sector firms, the finance ministry is looking at the possibility of disinvesting stake in state-owned Housing and Urban Development Corporation Ltd (HUDCO).
The department of disinvestment is in talks with the ministry of housing and urban poverty alleviation, which is the nodal ministry for the PSU, on a proposal to sell 10 per cent of the government equity in the firm.
“The discussions are at an initial stage. We are looking at selling 10 per cent government stake in HUDCO through an initial public offering,” a government official said, adding that the state-owned firm could also look at raising fresh capital through the issue.
HUDCO, which was set up in 1970, is fully owned by the government. It undertakes housing and urban infrastructure development programmes in the country, provides long-term finance for construction of houses and also finances and undertakes setting up of the new or satellite towns and industrial enterprises.
As on March 31,2011, the state-owned housing finance company had total assets worth Rs 22,668 crore and a profit of Rs 550.3 crore.
This would be the government’s second attempt to sell its stake in HUDCO. The UPA had proposed to disinvest 15 per cent stake in the housing finance company in 2006 but did not pass muster with the Left parties that supported the government at that time.
In 2012-13, the department of disinvestment is planning to sell stakes in about six firms as it tries to meet a target of Rs 30,000 crore from sell of proceeds. But it is keen to largely divest equity in unlisted firms in order to enhance their corporate governance through listing. Apart from HUDCO, state-run firms including RINL, Hindustan Copper Ltd and Hindustan Aeronautics Ltd are expected to launch initial public offers.
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