Government selects 5 bankers to manage IOC stake sale

Citibank, HSBC and UBS Securities are among the five merchant bankers selected to manage the sale of 10 per cent of the government's stake in Indian Oil Corporation (IOC).

The other bankers selected are SBI Capital and J M Financial, sources said, adding that as many as 17 bankers made  presentations today before the disinvestment department.

Shares of IOC closed at Rs 221.90, up 1.46 per cent over previous close on the BSE. At the current market price, the sale of the 19.16 crore shares would fetch Rs 4,252 crore to the exchequer. At present, the government holds a 78.92 per cent stake in IOC.

The Finance Ministry had in May moved a draft Cabinet note for the disinvestment in IOC through an offer for sale. IOC, the nation's largest refiner, has a market capitalisation of Rs 53,876 crore. It posted a net profit of Rs 5,005 crore in 2012-13, up from Rs 3,954 crore in the previous year.

The company's profit peaked at Rs 10,221 crore in 2009-10. IOC sells fuel at below-market prices, for which it is partially compensated by the government. The disinvestment target through PSU stake sales in the current financial year is Rs 40,000 crore.