The Central government is preparing a fresh round of stake sale transactions in several public sector companies as part of its FY27 disinvestment and asset monetisation programme.
According to reports, the government is evaluating Offer for Sale (OFS) transactions in:
- Coal India Limited
- Life Insurance Corporation of India
- Indian Overseas Bank
- Indian Railway Finance Corporation Limited
The proposed stake dilution programme is expected to be executed gradually during the first two quarters of FY27, depending on market conditions.
Key Stake Sale Proposals Under Consideration
Coal India OFS
The government is reportedly considering:
- Up to 2% stake sale
in:
Coal India Limited through the OFS route.
Coal India remains one of the government’s largest listed public sector holdings and continues to play a major role in India’s energy sector.
LIC Stake Dilution
An additional stake sale in:
Life Insurance Corporation of India is also reportedly being evaluated.
The transaction may take place during:
- Q2 FY27 (July–September 2026)
The government has been gradually reducing its stake in LIC after the company’s landmark IPO.
Indian Overseas Bank and IRFC
Further stake dilution plans are also being considered in:
- Indian Overseas Bank
- Indian Railway Finance Corporation Limited
The government had already reduced stakes in both companies during FY26.
Government’s FY27 Monetisation Target
The proposed transactions form part of the Centre’s:
- ₹80,000 crore asset monetisation and disinvestment target for FY27
The government has continued using:
- OFS transactions
- Strategic stake sales
- Asset monetisation initiatives
to raise capital while improving public shareholding in state-owned enterprises.
Recent Government Stake Sales
The government has already undertaken several stake dilution exercises in recent months.
Recent transactions include:
- 2.17% stake sale in Indian Overseas Bank (December 2025)
- 2% stake sale in IRFC (February 2026)
- 8% stake sale in Central Bank of India
Reports indicated that the non-retail portion of the Central Bank OFS was subscribed:
- 2.35 times
reflecting healthy institutional interest.
Why OFS Transactions Matter
Offer for Sale (OFS) mechanisms help the government:
- Raise non-tax revenue
- Improve liquidity in PSU stocks
- Increase public float
- Meet SEBI minimum public shareholding norms
For investors, OFS transactions often:
- Increase trading activity
- Improve institutional participation
- Influence short-term stock prices
Market Focus on PSU Stocks
Public sector stocks continue to remain in focus amid:
- Government monetisation efforts
- Strong retail participation
- PSU banking momentum
- Infrastructure and railway spending themes
Companies such as:
- Coal India Limited
- Indian Railway Finance Corporation Limited
have seen significant investor attention over the past year.
Conclusion
The government’s proposed FY27 stake sale pipeline involving Coal India Limited, Life Insurance Corporation of India, Indian Overseas Bank and Indian Railway Finance Corporation Limited highlights continued momentum in India’s disinvestment programme. The planned OFS transactions are expected to support the Centre’s ₹80,000 crore asset monetisation target while improving public participation in state-owned enterprises.
Disclaimer:
This article is intended solely for educational and informational purposes. The securities or companies mentioned are provided as examples and should not be considered as recommendations. Nothing contained herein constitutes personal financial advice or investment recommendations. Readers are advised to conduct their own research and consult a qualified financial advisor before making any investment decisions.
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