New Delhi: The central government is planning to generate revenue from the Railway sector. Over the next four years, the government plans to raise about Rs 80,000 crore by gradually reducing its stake in some major railway-related public sector companies (PSUs). The government wants to make some from the government assets and invest it in development and infrastructure projects.
Seven major railway public sector companies are expected to be a part of the government’s plan, a report said. The companies include Rail Vikas Nigam Limited (RVNL), Ircon International, RailTel Corporation, RITES Limited, Container Corporation of India (CONCOR), Indian Railway Finance Corporation (IRFC), and Indian Railway Catering and Tourism Corporation (IRCTC). At present, the government holds the maximum stake in all these companies. The government would retains at least 51 percent ownership after the proposed sale.
Key Railway PSUs targeted for partial stake sale via OFS
Citing government sources, Business Standard, reported that the stake sale will not happen all at once but in different phases. The government is contemplating on opting for the Offer for Sale (OFS) route to garner funds. The OFS will give the opportunity to domestic and institutional investors to invest in these PSUs.
Railway-related PSU companies have shown consistent growth in recent years. The expansion of freight corridor, passenger services, digital systems, introduction of new trains, and logistics have helped these companies generating profits. The government is of the view that partial disinvestment help raise a good amount of funds and also improve transparency and efficiency in these companies. The funds raised will be used for developing the Railway infrastructure
According to market experts, the interested investors will get an opportunity to pump in money to take a stake in profitable and strong government companies engaged in the Railway sector. The partial disinvestment process would help the government earn money and use it for modernisation and expansion of the railways.
The report stated that the stake sale process is expected to start from financial year 2027 and continue until 2030.
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