Asset monetisation may fetch Rs 12,000 crore in FY24, Rs 15,000 crore in FY25: DIPAM Secy

The government may earn as much as Rs 12,000 crore from asset monetisation this fiscal and another Rs 15,000 crore next fiscal, said Tuhin Kanta Pandey, Secretary, Department of Investment and Public Asset Management, and said that dividends from CPSEs will continue to be a steady source of income. In a post Budget interview with BT, Pandey spoke about the status of privatisation of IDBI Bank, Shipping Corporation of India and Concor. Edited Excerpts:

What is the status on asset monetisation and how much do you expect from it in this fiscal and the next?

Asset monetization has various aspects and it has got different models also -- such as InvITs, TOT in NHAI securitisation, PPP. The money can also flow either to the Consolidated Fund of India or the CPSE. From the point of view of asset monetisation, we classify only that money which enters the Consolidated Fund of India. In FY24, we are looking at about Rs 10,000 to Rs 12,000 crore in the revised estimate from the total estimate of Rs 30,000 crore and maybe about Rs 15,000 crore next fiscal from asset monetisation out of the Rs 50,000 estimate. However, these numbers are fluid.

Will the dependence of dividends from CPSEs continue in FY25 as well?

Yes, of course, because that is a very steady source of income. We continue to get the dividends as long as the CPSE perform well and earn profits. Dividends are a broader part of the non tax revenue. It was budgeted at Rs 3 lakh crore in FY24 and a Rs 75,000 crore increase in the Revised Estimates. It is Budgeted at Rs 4 lakh crore in FY25. So, dividends have done much better than what was projected.

While the government has been very keen on privatization and disinvestment, there is a feeling that the focus has gone down in recent years. Do you agree with this?

In minority stake sale, the first task is listing. Since 2014, we have done about 18 listings. Post that, government stake can be diluted gradually to up to 49% to maintain majority ownership and control. That is a call taken based on the state of dilution, dividend income and value creation. So stake dilution has to be done in calibrated, gradual and sustained manner. We are already at 51% in many companies. To launch a privatisation transaction, we have to assess a number of factors including whether we are prepared to pass on management control at that point of time or not.

What is the status of privatisation transactions such as the IDBI Bank, Container Corporation of India (Concor) and Shipping Corporation of India (SCI) Ltd?  

In Concor, we have not launched the Expression of Interest so the transaction hasn't begun yet technically except for the in-principle approval earlier. SCI privatisation is in advanced stages. The demerger has happened for the non-core assets. Now final completion of that transaction through NoCs from state government is pending and the listing of the new entity, which is SCILAL is expected in about a month's time. IDBI Bank is also ongoing and the fit and proper, RBI examination is under process. It's an ongoing transaction.

Will we see more listings or IPOs happening in the new fiscal?

There aren't many fresh IPOs as such in the government stable. Power sector PSUs have floated a number of subsidiaries in the renewable energy space that may be taken for listing.

How is LIC doing post listing and are you looking at a further stake dilution?

LIC has made tremendous strides, in terms of market orientation, and that's very important. It is working on its product portfolio as well as digital initiatives. LIC’s earnings have seen a tremendous boost and its embedded value has grown very healthy.  For further dilution, the stock price is also very important. LIC being a very unique kind of enterprise, the market needed to understand how it is doing for a few quarters. That is the important thing and not to rush into any further dilution.

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