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Informist, Thursday, Apr. 2, 2026

 

--Fin min source: May sell stake in GIC, LIC, Mazagon Dock, IRFC in FY27

--Fin min source: To sell stakes in four PSUs to meet FY27 Budget target

 

By Sagar Sen

 

NEW DELHI – The government is likely to sell stakes in General Insurance Corp. of India, Life Insurance Corp. of India, Mazagon Dock Shipbuilders Ltd., and Indian Railways Finance Corp. Ltd. in 2026-27 (Apr-Mar), a senior finance ministry official said. The ministry is yet to decide on the actual quantum of stakes that will be sold in these public sector units and a decision in this regard will be taken later depending on market conditions, the official told Informist.

 

The government may be cautious about coming to the market with these minority stake sales amid the ongoing West Asia war, the official said. Currently, the government holds a 96.5% stake in LIC, 82.4% in GIC, 81.22% in Mazagon Dock Shipbuilders, and 84.65% in IRFC. For the current financial year, the government aims to collect INR 800 billion through disinvestment and asset monetisation, more than double the revised target of INR 338.37 billion for FY26. The government met this target, with asset monetisation receipts of INR 188.37 billion and disinvestment receipts of INR 168.86 billion.

 

These disinvestments will be in addition to the government's plan to divest stakes in Indian Overseas Bank, UCO Bank, and Central Bank of India this fiscal. The decision to sell these stakes was driven by the need to meet the minimum public shareholding norms.

 

According to the Securities and Exchange Board of India's Securities Contract (Regulation) Rules, all listed companies, including public sector companies, need to have a minimum public shareholding of 25%. In August 2024, the government had granted five public sector banks — UCO Bank, Bank of Maharashtra, Central Bank of India, Indian Overseas Bank, and Punjab & Sind Bank — time till Aug. 1, 2026, to meet the norm. Of these, Bank of Maharashtra has complied with the norm after the government sold 6% stake in the bank in December.

 

Currently, Central Bank of India has a public shareholding of 10.73%, UCO Bank has a 9.05% public float, Punjab & Sind Bank has 6.15%, while only 7.56% of Indian Overseas Bank is with public shareholders.

 

The government had collected INR 23.46 billion in September 2024 by divesting a 3.39% stake in GIC. In April 2025, the government had sold a 3.61% stake in Mazagon Dock for INR 36.73 billion. In February this year, the government chose not to exercise the greenshoe option to sell an additional 2% stake in IRFC's offer for sale due to poor investor interest. However, it collected INR 23.30 billion by selling a 1.71% stake in the company.

 

On Wednesday, shares of GIC closed 4.7% higher at INR 380.10 on the National Stock Exchange, while those of Mazagon Dock closed over 12% higher at INR 2,318.20. IRFC's shares closed at INR 91.99, up 5.5%, and shares of LIC ended up almost 3% at INR 746.  End

 

Edited by Tanima Banerjee

 

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