New Delhi: The government has launched another sell-off of a state-owned energy firm, putting up to 6% of NHPC for sale at what critics say is a steeply discounted price that risks shortchanging the public exchequer. DIPAM announced the offer-for-sale (OFS) on Monday, proposing a base sale of 3% of NHPC’s equity with an additional 3% green-shoe option in case of oversubscription.
The government set a floor price of Rs 71 a share — roughly 8% below Monday’s BSE close of Rs 77.19 — following which NHPC’s stock slipped about 2% on Monday and over 4% further on Tuesday morning.
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NHPC OFS: Rs 4200 crore size with 6% stake to be sold
The OFS opens to non-retail investors on June 2 and to retail investors on June 3. At the floor price, the sale of around 60.27 crore shares representing a 6% stake would raise about Rs 4,200 crore for the exchequer.
Analysts and opposition voices are likely to question both the pricing and the timing. Selling at an 8% discount to the previous close risks leaving money on the table for taxpayers, especially when the government has repeatedly set ambitious disinvestment targets.
Third PSU OFS in this fiscal year
This is the third OFS of a public sector company this fiscal year: last week the state sold 2% of Coal India to raise Rs 5,542 crore, and in May it offloaded 8.08% of Central Bank of India to fetch Rs 2,266 crore. Combined disinvestment receipts for FY'27 now stand at Rs 7,808 crore.
The moves come against the backdrop of a bold FY'27 Budget estimate that targets Rs 80,000 crore from disinvestment and asset monetisation — more than double the revised FY'26 target of Rs 33,837 crore. Critics argue the pressure to meet lofty fiscal targets may be driving quicker, discounted disposals of strategic assets, potentially undermining long-term value and public interest.
Government officials frame these transactions as routine market-driven processes to mobilise resources. But opposition parties and some market watchers warn that repeated, discounted OFS tranches could erode investor confidence in the pricing discipline of future privatisations and may set an undesirable precedent for selling stakes in public sector firms.
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Investors will watch subscription levels closely. If demand is weak and the green-shoe is left unused, the government will have to reconcile the shortfall against its ambitious disinvestment timetable and explain whether fiscal targets are reshaping disposal strategy at the cost of maximising returns for taxpayers.
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