What is the compulsion that the government has to sell its stake in the defense company HAL?

New Delhi: Modi government is going to reduce its stake in aerospace and defense company Hindustan Aeronautics Limited (HAL). This information has been given to the stock market by HAL. In which it is said that the government is going to sell its 3.5 per cent stake in the company. The government is going to reduce its 3.5 per cent stake in the company through an offer for sale. The government will collect Rs 2800 crore by selling this stake.

The government will sell its 3.5 per cent stake in defense public sector Hindustan Aeronautics Limited (HAL) at a floor price of Rs 2,450 per share. From this he is likely to get around Rs 2,800 crore. HAL gave this information to the stock exchanges on Wednesday. Accordingly, the government will come out with a two-day open offer for sale (OFS) to sell its stake in HAL. Institutional investors will be able to buy its shares on Thursday while retail investors will be able to buy on Friday. Under the OFS, HAL will initially offer 1.75 per cent stake ie 58.51 lakh shares with an option to sell further shares in case of oversubscription. In this way, the total stake of HAL can be offered up to 3.5 percent.

Under the OFS, the floor price has been fixed at Rs 2,450 per share. At this price, if the entire stake of 3.5 per cent is sold, the government will get Rs 2,800 crore. The government currently holds 75.15 per cent stake in HAL. This stake sale will help the government to increase its disinvestment revenue. The government has so far raised Rs 31,106.64 crore in the current financial year through disinvestment of Central Public Sector Undertakings and share buyback. Though the disinvestment target for the financial year 2022-23 was kept at Rs 65,000 crore, it was revised to Rs 50,000 crore last month.