Hindustan zinc OFS likely by Nov; Dipam working out details

The government is planning to sell a part or all of its remaining 29.5% stake in Hindustan Zinc Ltd (HZL) by November, officials aware of the plan said.

The Department of Investment and Public Asset Management (DIPAM) is weighing different options including selling the entire stake at one go or in tranches, and will shortly take a final call on the matter, they said.

The Centre may divest its entire stake if the market condition is right and the valuation good, said one of the officials.

DIPAM will discuss the various options with investment bankers to finalise a plan in the next few days.

Currently, Vedanta Ltd holds a 64.92% stake in HZL, which was once a public sector undertaking. A little over 5.5% is with the public.

At Friday's closing price of ₹285.35 on the BSE, the Centre's stake in HZL is worth more than ₹35,600 crore.

"We have appointed investment bankers and the appointment of the legal adviser will be complete by this month, and we already have the necessary approvals to go ahead," the official said.

DIPAM on Thursday issued a request for proposal for the engagement of a legal adviser for its HZL stake sale. The bids have to be submitted by September 16. The department aims to commence the disinvestment process by the month end.

Last month, the Centre appointed five investment bankers - ICICI Securities, Axis Capital, Citigroup Global Markets, HDFC Bank and IIFL Securities - to manage the stake sale. The Union Cabinet approved the stake sale in May this year.

The Centre has a ₹65,000 crore disinvestment target this year and a successful HZL divestment can help meet the target, since it has already raised ₹24,544 crore in FY23.

A delay in the strategic sale of Pawan Hans, Shipping Corporation of India, BEML and IDBI Bank, and less-than-expected public offer of Life Insurance Corporation of India had forced the government to fix the focus on HZL. The strategic sale of Bharat Petroleum Corp has been aborted because of a lack of response.