The run up in the primary market space has been overwhelming in the FY18 with total fund raising volume estimated at Rs. 82,000 crore from IPO issues of 38 companies both from the private and public space. The companies from the PSU space are going public to meet government's disinvestment target. And, through 6 IPOs of HUDCO, Cochin Shipyard, New India Assurance, General Insurance Corp, HAL and Bharat Dynamics launched this year, the net amount raised equals to Rs. 24,000 crore.
In the FY 2018-19, the public offers by PSU companies will continue as the combined disinvestment target is kept at Rs. 80,000 crores. Here's a complete list of likely PSU offers for the year:
1. Rites: The company from the railway sector is expected to hit the market by May this year and govt. aims at divesting 12% stake for raising an estimated amount of Rs. 600 crore.
2. IRFC or Indian Railways Finance Corporation: The market borrowing entity of the Indian railways is expected to be taken public in May. And the process of its listing has been eased by way of lower taxation as per a Ministry of Corporate Affairs notification which has exempted the company from accumulated deferred tax liability of Rs 63.92 billion. The result shall be better valuation for the company as it would add to the net worth.
It is expected that govt. will sell 10% stake in the company through the offer.
3. IREDA or Indian Renewable Energy Development Agency: State-owned IREDA as per a Bloomberg report is expected to hit in June this year. Through the IPO issue, the government will offload 13.90 crore shares in the company. The offer received SEBI's go-ahead on February 16. The IPO issue by IREDA is likely to be followed by an FPO in the next two to three years.
4. Ircon: State run railway infrastructure engineering and construction company Ircon International Ltd filed its draft prospectus with the SEBI to launch its IPO. Through the issue, the government, which is acting as the promoter through the Ministry of Railways, has proposed to sell 9.90 million Ircon shares, or a 10.53% stake in the company. The IPO size is estimated at Rs 1,000 crore.
5. RVNL or Rail Vikas Nigam Ltd: Another rail PSU will hit the market to offload 25% stake and the issue is expected later this year.
6. Garden Reach Shipbuilders and Engineers Ltd: State-run warship manufacturing company also plans to raise Rs 1,000-1,200crore through a public issue.
7. Mazagon Dock Ltd: Another shipbuilding company is set to go public this year and the government will sell 22.41 million shares, excluding any shares reserved for employees. Through the issue, the govt. plans to raise Rs. 1500 crore.
8. Merged entity of 3 General Insurers: In the Budget 2018, the govt announced the merger of three general insurance PSUs including National Insurance, Oriental Insurance and United India Insurance. The merged entity is then proposed to be listed on the exchanges.