Govt open to SBI, ONGC disinvestments; looking to improve PSU valuations: FM Nirmala Sitharaman

Sitharaman also highlighted that the private sector has been allowed into the “core strategic” sectors and the government wants to have only “minimum presence” in these sectors.

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26 Aug, 2025 12:21

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Finance Minister Nirmala Sitharaman on February 2 said the government is open to the idea of disinvestment of equity stake in blue-chip PSUs including State Bank of India (SBI) and Oil and Natural Gas Corp (ONGC). The government is not against the idea of holding a minority stake (less than 50 percent) in key strategic public sector companies, she said in an exclusive interview with Network18.

“Absolutely,” Sitharaman told Network18 Editor-in-Chief Rahul Joshi, when asked if she was okay with holding 49 percent or less in PSUs including SBI and ONGC. Currently the government holds a controlling 57.49 percent stake in SBI and 58.89 percent stake in ONGC.

“You will see periodically, DIPAM, the department which takes care of the disinvestment has slowly released a lot of government's shares into the market so that private ownerships can come in and they can take hold of those shares,” said Sitharaman.

The government has been on a divestment drive in recent years, selling stake in numerous publicly listed and privately held companies. However, it has sold the controlling stake in only Air India in recent years, which was acquired by Tata Group.

Steps for raising the valuations of PSUs

The finance minister also highlighted that the government was all in for those steps that raise the valuation of PSUs. Government owned companies have historically traded at discounts to their private peers. However, in the last couple of years, they have closed the gap.

“We are working to make sure that…the valuations are kept up,” she said. “If you look at the public sector listed companies and their valuation in the market today, you see the kind of vibrancy which has been brought into them. The share prices have gone up, the dividends are much better than earlier. So, disinvestment is one thing but (we are working on) bringing value to them, and making sure that the market looks at them favourably.”

Sitharaman also highlighted that the private sector has been allowed into those “core strategic” sectors and the government wants to have only “minimum presence” in these sectors.