NEW DELHI: State-run electricity generator NTPC on Monday informed stock exchanges that its Board of directors will meet on November 2, to consider a proposal to buy back shares of the company. The notice said the board would meet to consider the un-audited financial results for the half year ended September 30 and “consider proposal for buyback of equity shares” of the firm.
Markets regulator Sebi had granted exemption to the power utility from certain buyback norms for a proposed merger of wholly-owned subsidiaries with the parent company. This springs from a decision in November last year by the NTPC board to merge Nabinagar Power Generating Company Ltd and Kanti Bijlee Utpadan Nigam with NTPC.
The government currently holds 51.02 per cent stake in the power utility. The Department of Investment and Public Asset Management which has a target of earning Rs 2.1 lakh crore from disinvestment receipts is believed to eyeing buy-back of shares by some 6-8 blue-chip PSUs as one of the ways of achieving the target.
Sources said other firms which may be tapped for buy-backs to swell the government’s revenue earnings include NMDC, MOIL and Engineers India Ltd. The finance ministry has for several years now been encouraging PSUs who have surplus reserves and do not sufficient capital expenditure plans, to consider buy backs.