India is planning to ask some state-owned companies to repurchase shares to help the government shore up its finances amid the coronavirus pandemic, according to a person with knowledge of the matter.
Coal India Ltd., NTPC Ltd., NMDC Ltd., MOIL Ltd., KIOCL Ltd, and Engineers India Ltd. are among the eight companies that might be asked to buy back shares this year, the person said, asking not to be identified as the information is not public. The government, being the largest shareholder in these companies, will benefit from the transactions by tendering the equity it holds in return for cash.
The strategy will help Prime Minister Narendra Modi’s administration access part of the more than 400 billion rupees ($5.5 billion) of cash hoard with the companies as of March 31, at a time it has struggled to meet its target of raising money from tax and sale of state assets.
