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Government planning to buy back shares of loss-making PSUs, says report

Government planning to buy back shares of loss-making PSUs, says report

Government planning to buy back shares of loss-making PSUs, says report
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By CNBC-TV18 Mar 27, 2019 9:16:02 AM IST (Published)

The government is looking to buy back loss-making public sector companies' shares and delist them, reported The Economic Times, adding that the plan could bring relief to retail investors.

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According to the report, a top government official said that at least six PSUs including HMT and State Trading Corporation (STC) are likely to be delisted as part of this as they are not able to comply with the minimum public shareholding (MPS) norms. Sebi has ordered that the companies must comply with the public shareholding norms by October 2020.
If executed, the plan would be a big relief to over 18,000 retail investors in HMT, who saw the share value fall from Rs 104 in 2008 to Rs 20, now, said the report.
“We don’t want to seek any further extension from Sebi. In most of the companies, we are comfortable since there is strong investor appetite…However, we want to wind up the loss-making entities from public markets since it is difficult to find investors for divestment,”  an official was quoted as saying in the report.
According to the report, the Department of Investment and Public Asset Management (Dipam) will soon prepare the roadmap for the delisting of these companies.
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