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Now, PSUs to rescue govt’s failing strategic sale programme

In the absence of bidders, the government is now looking to shut down Hindustan Prefab Ltd. rather than offering it to a strategic investor.

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New Delhi, Oct 2 : The government has decided to rely on cash-rich central public sector enterprises (CPSEs) to rescue its strategic sale programme, with tepid interest coming from the private sector to take over controlling interest in some of sick and loss-making companies.

DIPAM (Department of Investment and Public Asset Management) officials said that several proposals for sale of majority government holding in companies this year will be offered to willing CPSEs proposing to give a good valuation, for the Centre’s stake. This, officials believe, would eliminate the need to go through a complex sell-off process with no result coming at the end.

The change of stand follows a poor investor response to some of strategic sale initiatives undertaken by the disinvestment department recently. In the case of Pawan Hans Helicopters Ltd (PHHL), where the government offered to sell its entire 51 per cent stake to strategic investors last month, the bidding process failed to attract any investors, forcing four extensions so far in the date for submitting expression of interest.

Similarly, in the absence of bidders, the government is now looking to shut down Hindustan Prefab Ltd. rather than offering it to a strategic investor.

“Several of the sick and loss-making CPSEs suffer from closed-down operations and excessive manpower. If in some way these issues could be sorted out before an entity is put up under strategic sale route, the valuations and interest would be high. Getting PSU on board is a good plan, but government should allow its companies to take such investment decisions on their own rather than pushing them into taking any uneconomic move,” said a former Cabinet Secretary asking not to be named.

Sources said that the DIPAM is enthused by the recent Rs 4,800 deal struck between GAIL and an IL&FS subsidiary to take over the latter’s 874 MW of operational wind projects.

A core group of Secretaries has also favoured a plan for country’s largest power producer NTPC to take over the entire government holding in THDC India while hydro power major NHPC takes over the North Eastern Electric Power Corporation Ltd (NEEPCO).

More such options would be looked to bring several other strategic disinvestment proposals that have got delayed over lack of investor interest. In the list are companies such as Scooters India, Ferro Scrap Nigam, Bridge and Roof, Hindustan Fluorocarbons, India Medicines and Pharmaceuticals, Engineers Projects etc.

Officials believe that if PSUs are involved in strategic sale, it could provide synergy to existing operations of a state-run company, the sell off process would not only be smooth but government could also get better valuation for its shares.

The government’s strategic sale initiative has not taken off well as a few cases that were brought out under the plan failed to attract investors. Last year, Air India’s disinvestment bid had also fallen flat for want of bidders. Similarly, previous attempts to sell other loss making entities such as Scooters India, the makers of the popular Vikram brand of three-wheelers, have failed to move in the last one year.

DIPAM has drawn up plan for strategic sale in 35 PSUs, including Air India, Air India subsidiary AIATSL, the Dredging Corporation, BEML, Scooters India, Bharat Pumps Compressors, and the Bhadrawati, Salem and Durgapur units of steel major SAIL. While any PSUs interest in some of the companies on the strategic sale route is likely to be low, a few offers could be tempting for companies looking to expand their operations and scouting for suitable land for projects.

Companies such as Scooters India, Indian Drug and Pharmaceuticals Ltd (IDPL) and a few others are sitting on huge tracts of land that can be used by cash-rich PSUs to expand their own operations or carry out any diversification plan. IDPL is sitting on 834-acre of prime land in Rishikesh while Scooters India has about 150 acre of land near Lucknow.

However, not all cash-rich PSUs are happy about the government’s proposed plan. They feel that loss-making companies should not be imposed on them if it fails to attract any investor.

There have been examples how such acquisition plan have shaken even the most profitable and stable CPSEs. ONGC was a debt free company till it had to buy the entire government’share in HPCL. Now the company is not only left with about Rs 14,000 crore of debt but its cash and bank balance plummetted to a mere Rs 167 crore in Sept 2018, down from Rs 9,511 crore just over a year back. Now if, Pawan Hans, (where ONGC also owns 49 per cent stake) is thrust upon it, the company without cash will have no other option but to borrow more from the market.

(Subhash Narayan can be contacted at [email protected])

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Delhi Riots: Jamia student released on parole to sit for exams

The court said that clearing the exams is necessary for Tanha to pursue M.A. in Persian, and that leniency must be shown to the accused by allowing him to appear for the said exams.

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Asif Iqbal Tanha

New Delhi: A Delhi court on Friday released Jamia Millia Islamia student Asif Iqbal Tanha — who was arrested under the stringent Unlawful Activities (Prevention) Act for allegedly hatching a conspiracy to organise riots in North-East Delhi in February this year — on three-day custody parole to appear for his compartmental examination in December.

Tanha, who is pursuing his B.A. (Hons) in Persian, had moved the court seeking interim bail from November 30 to December 7 to prepare for three backlog exams scheduled to be held on December 4, 5 and 7.

“The court deems it fit to allow the accused on custody parole for appearing in the said examinations. Accordingly, custody parole is granted to accused Asif Iqbal Tanha on December 4, 5 and 7,” Additional Sessions Judge Amitabh Rawat ordered.

The court said that clearing the exams is necessary for Tanha to pursue M.A. in Persian, and that leniency must be shown to the accused by allowing him to appear for the said exams.

After advocate Sowjhanya Shankaran, representing Tanha, submitted that her client didn’t not have the required reading material to prepare for the exams, the judge directed the Tihar Jail superintendent to provide necessary assistance, provided it is within the permissibility of the jail rules.

Tanha was arrested on May 19 in connection with the case and has been in the custody since then. On October 21, he was granted one-day interim bail for taking the entrance examination for M.A Persian at the Jamia Milia Islamia University.

In September, his named figured in the chargesheet filed by the Delhi Police in connection with the riots that broke out in North-East Delhi in February after clashes between pro and anti-Citizenship Amendment Act supporters spiralled out of control, leaving 53 people dead and 748 injured.

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India enters recession: GDP drops by 7.5% in July-September quarter

The National Statistical Office (NSO) data on Friday showed that the Q2FY21 GDP on a year-on-year basis contracted by (-) 7.5 per cent from (-) 23.9 per cent in the preceding quarter.

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National debt under Modi govt surges

New Delhi: Even though India’s economic recovery accelerated in Q2FY21 from the lows of the pandemic-induced lockdown, the country for the very first time since Independence entered into a technical recession.

The National Statistical Office (NSO) data on Friday showed that the Q2FY21 GDP on a year-on-year basis contracted by (-) 7.5 per cent from (-) 23.9 per cent in the preceding quarter.

Though not comparable, the GDP had grown by 4.4 per cent in the corresponding quarter of FY2019-20.

In financial parlance, an economy is said to have entered a technical recession after it consistently remains in the negative output territory for two subsequent quarters.

This trend underscores the reduction in purchasing power along with lower tax collection for the government, likely defaults on debt and falling Capex spends.

According to the NSO, the GDP at ‘Constant (2011-12) Prices’ in Q2FY21 is estimated at Rs 33.14 lakh crore as against Rs 35.84 lakh crore in Q2FY20, showing a contraction of 7.5 per cent as compared to 4.4 per cent growth in Q2FY21.

“Quarterly ‘GVA at Basic Prices at Constant (2011-12) Prices’ for Q2 of 2020-21 is estimated at Rs 30.49 lakh crore, as against Rs 32.78 lakh crore in Q2 of 2019-20, showing a contraction of 7 per cent,” the NSO said in the estimates of Q2FY21 GDP.

“With a view to contain the spread of the Covid-19 pandemic, restrictions were imposed on the economic activities not deemed essential during Q1. Though the restrictions have been gradually lifted, there has been an impact on the economic activities,” it added.

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Black Friday Deals: Realme to bring offers on Realme X3 Superzoom, X50 Pro, Buds Air Neo and more

The Black Friday sale will take place on Realme’s online store, Flipkart and Amazon.

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Realme X2 Pro

Over the last few years, online and offline retailers have been offering their Black Friday deals for almost an entire week ahead of Thanksgiving, and some of these deals and offers last well after the Cyber Monday sale.

Black Friday Sale is here!!

After Xiaomi, handset maker Realme on Thursday announced a Black Friday Sale that would arrive with several offers and discounts on a range of its products. The Black Friday Sale would be live for 24 hours and would start November 27, 12:00 AM. The sale would see massive discounts on a range of Realme smartphones including Realme 6i, Realme 6, Realme X3 Superzoom and X50 Pro, and various AIoT products such as Realme Buds Classic, Realme Smart Watch, Realme Buds Air Neo and Realme Smart Cam 360°.

“Realme would also be hosting the ‘Realme Days’ sale offering similar discounts on its own website Realme.com, Flipkart and Amazon.in,” the company said in a statement.

The Black Friday sale will take place on Realme’s online store, Flipkart and Amazon. In addition to the discounts, SBI credit cardholders can avail of 5% cashback on EMI transactions.

  • Realme is offering discounts from Rs 1,000 up to Rs 7,000 for its Black Friday sale. Realme X50 Pro has received the biggest discount of Rs 7,000 bringing its price down to Rs 34,999 from Rs 41,999. Realme X50 Pro with 12GB RAM and 256GB storage also gets a discount making its offer price Rs 40,999.
  • Realme X3 SuperZoom will be available with a Rs 4,000 discount on all three variants. Realme X3 has also received a Rs 3,000 discount on both its variants. Realme C3, Realme 6, Realme 6i, and Narzo 20 Pro can be purchased with a discount of Rs 1,000.
  • In the AIoT portfolio, Realme Buds Air Neo would be available at a discounted price of Rs 1999, along with the Realme Buds Wireless Pro for Rs 3199 and Realme Buds Air Pro at a special price of Rs 4299. These offers would be applicable on all purchases made through Realme’s official website Realme.com.
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