The United Progressive Alliance government's divestment policy proposes initial public offers in 15 public sector units as well as fresh issues for 20 listed ones.

"The 51 per cent shareholding in 20 listed and 15 unlisted profit-making PSUs will be retained by the government," a government official said. Companies with annual turnover of over Rs 500 crore (Rs 5 billion) will be considered for IPOs.

IPOs in companies like Power Finance Corporation, Power Grid Corporation of India Ltd, National Hydroelectric Power Corporation, Bharat Sanchar Nigam Ltd and Neyveli Lignite could be expected in the coming days.

"The government will undertake ONGC and Gail-type transactions in Navratnas and profit-making PSUs, which will not result in loss of management control," said an official.

The policy, to be put up to the Union Cabinet shortly, is in line with the UPA government's stand against privatisation of Navratnas and a review of all ongoing divestment cases. Proposing further autonomy for PSUs, it also recommends an annual classification of profitable and loss-making companies.

The policy proposes the government should not privatise companies like Bharat Heavy Electricals Ltd, Hindustan Petroleum, Bharat Petroleum, Gail India Ltd, Indian Oil Corporation, Mahanagar Telephone Nigam Ltd, National Thermal Power Corporation, Oil and Natural Gas Corporation and Steel Authority of India Ltd.

On potentially sick and loss-making companies, the policy proposes the government should seek joint ventures with private players. Asset lease and strategic sales could also be considered.

Of the 75 chronically sick PSUs, 48 have been referred to the Board for Industrial and Financial Reconstruction and in the other 27, the government could consider sale of assets before winding them up.

Full managerial and commercial autonomy to PSUs have been proposed as well as greater transparency and efficiency by broadbasing shareholding. Unnecessary constraints imposed by government financial regulations are sought to be eased.

• PSUs with turnover of over Rs 500 cr qualify for listing
• Minority stake to be offered in domestic, overseas markets to enlarge public holdings
• Divestment of ongoing cases like HPCL, BPCL to be terminated, other to be reviewed
• No privatisation of profit-making and strategic PSUs
• Full managerial and commercial autonomy planned