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Coal India, NTPC, Nalco, NMDC in list
The Finance Ministry has shortlisted about a dozen companies, including Coal India, NTPC, Nalco and NMDC, for a possible buyback of shares in the ongoing financial year.
The other companies which are in the list include NLC, BHEL, NHPC, NBCC, SJVN, KIOCL and Hindustan Aeronautics, officials said. Earlier this week, the Department of Investment and Public Asset Management (DIPAM) discussed the buyback option with these companies, following which the list has been drafted.
Restructuring norms
These CPSEs have been asked to buy back the shares following the capital restructuring guidelines set out by DIPAM on May 27, 2016. Officials, however, said in view of the business plans of CPSEs, not all in the list would be able to buy back the shares in 2018-19. As per the guidelines, CPSEs having net worth of at least Rs. 2,000 crore and cash and bank balance of above Rs. 1,000 crore have to mandatorily go in for share buyback. It had also asked every CPSE to analyse in the first board meeting after the closure of a financial year the cash and bank balance, expansion plans, borrowing plans, net worth and market value of shares and explore the option for buying back the shares.
Share buybacks offer a route for companies to return some wealth to their shareholders.
Source : https://www.thehindu.com/todays-paper/tp-business/govt-shortlists-11-cpses-for-buyback/article24897747.ece
