The government is likely to adopt a cautious approach towards minority stake sales in central public sector enterprises (CPSEs) in the coming months due to ongoing market volatility, officials privy to the matter told CNBC-TV18. While disinvestment remains on the agenda, the Centre may defer planned offers for sale (OFS) by one to two months, depending on market conditions.

“We are monitoring the market closely. Given the current volatility, it makes sense to wait for a more favorable window before proceeding with any stake sales,” said the official, who requested anonymity.

The government had been considering stake sales in several Central Public Sector Enterprises (CPSEs) to meet its disinvestment targets for the current financial year.

At the lows, shares of most state-run companies had declined between 30% to 60% from the highs that they had seen in 2024.

Currently, the government is in the process of diluting some shareholding in four PSU Banks – UCO Bank, Punjab & Sind Bank, Central Bank of India and Indian Overseas Bank. While Indian Overseas Bank raised ₹1,436 crore through its institutional share sale process, the QIPs are currently open for the other three banks.

While stake sales may slow down, the government is eyeing a substantial windfall from CPSE dividends in the current financial year. According to projections, CPSEs are expected to distribute dividends worth around ₹1.40 lakh crore to investors, including the government, by March 31, 2025.

“CPSEs are expected to maintain strong dividend payouts this year, contributing significantly to the exchequer and helping to bridge any shortfall in the disinvestment target,” the source added.

So far in the current financial year, the government has received nearly ₹70,000 crore from CPSEs as dividends and ₹9,300 crore via divestment receipts.

Despite the anticipated slowdown in minority stake sales, the government is expected to stay on course with its strategic disinvestment plans, which involve the sale of controlling stakes in select CPSEs. These transactions, however, are expected to proceed independently of market fluctuations.