Govt shortlists 17 bankers for BHEL follow-on public offer

The proposed offloading of the government's 5% stake in Bharat Heavy Electricals (BHEL) is part of the Centre's ambitious programme to mop up Rs 40,000 crore through disinvestment in the current fiscal.

Besides ICICI Securities, SBI Caps and Goldman Sachs, DSP Merrill Lynch (Bank of America), Enam Securities, Credit Suisse India, J M Financials, UBS Securities, Citi Bank, RBS, Nomura, IDFC, Kotak Mahindra Capital, Deutsche Bank, IDBI Capital Market Services and Edelweiss Capital have also been shortlisted, according to the Department of Disinvestment.

Based on today's market capitalisation of Rs 94,176 crore, five per cent disinvestment in BHEL would fetch over Rs 4,700 crore to the government.

At the end of June quarter, the government held 67.72% stake in BHEL.

Nine merchant bankers would make their presentations regarding the FPO on July 18, while the remaining eight entities would do the same on July 19, the Department of Disinvestment said in a statement today.

BHEL's consolidated net profit jumped 40% to Rs 6,053.36 crore in 2010-11.

"The board of directors of the company has recommended the disinvestment of 5% of the paid-up equity of BHEL out of the government of India's shareholding," the state-run entity had said in May.

This fiscal so far, the government has mopped up more than Rs 1,100 crore by divesting five per cent equity in Power Finance Corporation (PFC).

The government aims to generate Rs 95,000 crore between 2011-12 and 2013-14 from selling its equities in state-run enterprises.

In the last fiscal, disinvestments raked in Rs 22,762.96 crore, much lower than the set target of Rs 40,000 crore.