Trying to raise PSU valuation to raise more money

A plan to privatize a government undertaking to bring down the fiscal deficit that has gone

The government has initiated efforts to increase the valuation of public sector undertakings as much as possible so that huge sums of money can be raised through privatization.

To ease the pressure on the country's fiscal deficit due to Corona, the government plans to raise money through various sources, including the privatization of public sector undertakings, finance ministry sources said.

Increase the market cap of public sector companies and also pay more dividends so that it will be easier to raise more money by selling their equities from the next financial year.

In general, government undertakings are more focused on increasing production and revenue. There is no special emphasis on increasing efficiency and evaluation. As a result, the share price of such ventures is lower than the overall market.

Companies should increase their valuation and profitability amid the changing business environment. Only then will such companies get good share prices, according to a draft prepared by the government.

The government plans to raise Rs 3.25 trillion by 2024 by selling its stake in public sector undertakings such as ONGC, IOC, BEML, sources said.

The government has started taking steps to sell stakes in some companies. The government has been able to raise only 10% against the target of Rs 1.20 trillion in the current financial year.