Modi government might sell 5% stake in BHEL for ₹4,500cr
What's the story
The Indian government is planning to divest up to a 5% stake in Bharat Heavy Electricals Limited (BHEL) through an Offer for Sale (OFS). The floor price for the OFS is likely to be between ₹255 and ₹260 per share. The Department of Investment and Public Asset Management (DIPAM) is currently seeking feedback from bankers on this proposed sale.
Financial impact
Stake sale could generate ₹4,500cr for government
The government's stake sale in BHEL through the OFS route could fetch around ₹4,500 crore. This move comes as part of the government's broader strategy to monetize its assets and generate revenue. The exact timeline for the stake sale and its final execution will depend on market conditions and investor response.
New contract
BHEL receives ₹2,800cr order from BCGCL
Earlier today, BHEL received a Letter of Acceptance (LoA) from Bharat Coal Gasification and Chemicals Limited (BCGCL) for a project worth around ₹2,800 crore. The order is for the Syngas Purification Plant under the LSTK-2 package for BCGCL's coal-to-ammonium nitrate project in Odisha's Jharsuguda district. BCGCL is a joint venture between Coal India, which holds a 51% stake, and BHEL, which owns the remaining 49%.
Project details
Project to achieve preliminary acceptance in 42 months
Under the contract with BCGCL, BHEL will be responsible for designing, engineering, supply of equipment, civil works, erection and commissioning, as well as operations and maintenance services. The project is expected to achieve preliminary acceptance within 42 months from the date of LoA. Operations and maintenance services will continue for an additional 60 months post preliminary acceptance.