The central government is planning to list WAPCOS Limited as part of its divestment drive. The Miniratna PSU – operating under the Ministry of Jal Shakti – offers consultancy and EPC services to water, power and infrastructure sectors worldwide. WAPCOS IPO will see the government reducing its stake in the company from the current 100% to 75%, said the Department of Investment and Public Asset Management (DIPAM) in a statement.
The statement comes as DIPAM has floated tenders for engaging a registrar and an advertising agency for the disinvestment process. The interested parties will need to make their submissions by 24 February.
While the listing of WAPCOS will be a positive step from investors’ point of view, it will be a case of being too little and too late from the government which had set a target of INR2.1 lakh crore (INR2,100 billion) for FY2021. Since the financial year was grossly affected by Coronavirus pandemic, the government is all set to miss this target by a wide margin.
For the next financial year, the government has set a more realistic target of INR1.75 lakh crore while spelling out the vision of exiting management control of PSUs in non-strategic sectors and of retaining a minimum number of PSUs in strategic sectors.
WAPCOS IPO – On lines of Rites
PSU consultancy firms with domain expertise have performed well on the bourses, last such case being transport consultancy and engineering player Rites which got listed in 2018.
For the year ended 31 March 2020, WAPCOS registered a 9.7% growth in revenues to INR1,550.2 crore while also posting profot before tax of INR212.3 crore, marking an increase of 4.6%. The company has debt-free operations and has been paying regular dividends.
WAPCOS is the executing agency of Namami Gange project. Apart from India, the company has presence in 47 countries.