Govt plans stake sale worth Rs 22,000 crore in ITC, Axis Bank: report

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Govt plans stake sale worth Rs 22,000 crore in ITC, Axis Bank: report
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As on March 31, 2020, the federal government owned 7.96 per cent stake in ITC and 4.69 per cent shareholding in Axis Financial institution via the Specified Enterprise of the Unit Belief of India (SUUTI)

twitter-logo BusinessToday.In   New Delhi     Final Up to date: Could 6, 2020  | 23:59 IST
Govt plans stake sale worth Rs 22,000 crore in ITC, Axis Bank: report

Shares of ITC ended at Rs 163.80, down 5.81 per cent, whereas ITC closed marginally down (0.22 per cent) at Rs 388.35 on the BSE

The central authorities is reportedly trying to increase round to Rs 22,000 crore by promoting its complete stake in FMCG main ITC and personal sector lender Axis Financial institution. Reacting to the information, shares of ITC and Axis Financial institution declined as a lot as 7.64 per cent and 5.42 per cent, respectively, throughout intraday commerce on the Bombay Inventory Trade on Wednesday.

The transaction is predicted to be accomplished by the top of this week or early subsequent week, Financial Occasions reported quoting sources conscious of the event. The transaction will probably be completed via a bulk deal on the home inventory exchanges, the day by day reported.

As on March 31, 2020, the Centre owned 7.96 per cent stake in ITC via the Specified Enterprise of the Unit Belief of India (SUUTI), the administrator that manages the funds of the erstwhile Unit Belief of India (UTI) on behalf of the federal government.  Equally, the federal government owns 4.69 per cent shareholding in Axis Financial institution by way of SUUTI, as of March quarter of FY20.

The report mentioned that the proposed transaction will probably be completed at a marginal low cost of 2-Three per cent to underlying buying and selling value on the transaction date. The federal government could “exit utterly” from ITC and Axis Financial institution, it added.

Shares of ITC ended at Rs 163.80, down 5.81 per cent, whereas ITC closed marginally down (0.22 per cent) at Rs 388.35 on the BSE.

The transfer is being seen as part of Modi authorities’s plan to lift Rs 2.1 lakh crore via divestment in state-run firms. This consists of Rs 90,000 crore from partial stake sale in Life Insurance coverage Corp (LIC) via an preliminary public provide (IPO) and fairness sale in IDBI Financial institution. The Centre has already offloaded its complete stake in Larsen & Toubro.

By Chitranjan Kumar

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