Time not ripe to bring BHEL FPO: Praful Patel

The time is not ripe to bring the follow-on public offer (FPO) of state-run BHEL and the proposal needs to be examined again, Heavy Industries Minister Praful Patel said today.

"Disinvesting from public sector without finding its true value would be foolish. At this stage, the market sentiment is generally a little slow and specially for power and related sectors," Patel told reporters on the sidelines of a Standing Conference of Public Enterprises award function here.

He said the government would re-examine the proposal in a couple of months.

"At this moment, there is no question (of bringing FPO). Right now, we feel that the timing is not right to offload five per cent stake in BHEL," he added.

Earlier this month, the company withdrew the initial papers for the FPO filed with Securities and Exchange Board of India ( SEBI), following an instruction from the Finance Ministry.

The decision followed approval from Board of Directors of the company and 'no-objection' from the Department of Heavy Industry and the Department of Disinvestment (DOD).

BHEL filed the Draft Red Herring Prospectus (DRHP) in September 2011 for the FPO to offload five per cent government stake in the company. It stake sale was expected to fetch over Rs 4,000 crore. The government holds 67.72 per cent stake in the entity.

On imposition of duty on import of power equipment, Patel said there needs to be further consultation with the Finance Ministry in this regard.

"There needs to be further consultation, Finance Minister will be speaking to us," he added. The minister, however, did not mention as to when the discussions would take place.

Earlier this year, the Power Ministry had floated a Cabinet note seeking imposition of 19 per cent duty on imported power equipment, mainly from China.

The move is aimed at providing a level-playing field to the domestic equipment makers like BHEL and Larsen & Toubro.