New Delhi: The Empowered Group of Ministers on divestment on Wednesday approved the auction route for divestment of stake in state-owned Oil & Natural Gas Corp Ltd and will meet again soon to decide on timings and other details for the share sale, Petroleum Minister S. Jaipal Reddy said.
"We have decided to go in for the auction route," Reddy told reporters after a 30-minute meeting of the ministerial panel at North Block. "As for the further decision EGoM is going to meet shortly again."
However, Heavy Industries Minister Praful Patel, who was also present in the meeting, said divestment of stake in Bharat Heavy Electricals Ltd may happen only in the next financial year beginning April.
"No decision has been taken by the EGoM on BHEL divestment today. At this moment we have seen that it is a little premature. The sentiment about the power sector is prudent. The outlook is not bright and positive," Patel said.
Earlier this year, the Securities and Exchange Board of India had allowed promoters of top 100 listed companies by market capitalisation to auction their stake through stock exchanges. Only the promoter or promoter group entities of these companies were allowed to sell their shares through auctions but these entities would not be allowed to bid for these shares.
The government currently owns 74.14% stake in ONGC and 67.72% in BHEL and plans to divest 5% each in the companies.
Shares of both ONGC and BHEL were off highs after the EGoM deferred taking a firm decision on the divestment of its stake in the two state-owned firms. At 1451 IST, shares of ONGC were trading up 1.5% at 280.25 rupees, whereas BHEL shares were trading at 272.15 rupees on the National Stock Exchange, up 2.7% from their close Tuesday.  The 50-share Nifty was up over 2%.