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| THE government plans to sell shares in Oil & Natural Gas Corp and IndianOil to capitalise on the feel-good mood among investors after raising petroleum product prices last week.<br>The petroleum ministry wants the department of disinvestment to consider stake sale in the two companies as their financial position has been weakened by years of price control,which is set to continue for most products.The government can raise funds selling its stake and a company may sell new shares to improve finances.With fuel prices now being raised,the issue of under-recoveries of these firms has been addressed to some extent, said a senior government official privy to the development.So it is feasible for them to launch follow-on public offers.<br>Finance minister Pranab Mukherjee,who is facing a 5.5% fiscal deficit this year,aims to raise Rs 40,000 crore from sale of shares in government-run companies.Since follow-on offers of miner NMDC and utility NTPC did not enthuse investors,some in the government believe oil companies may be the right bet since the outlook has brightened following the announcement to free up petrol prices and an intention to do so with diesel. |
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6/29/2010
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