The heavy industries ministry has virtually consented to finance ministry's suggestion for part divestment of government equity in blue-chip PSU Bharat Heavy Electricals Ltd [Get Quote] and auto joint venture Maruti Udyog [Get Quote] in the current financial year.

It, however, asked the finance ministry to consider weightage for Indian public and institutions during the public offer fearing that foreign financial institutions would strive to get most of the shares of these profit-making companies, ministry sources said.

The finance ministry would now moot a formal proposal for divestment of 5 per cent equity in BHEL and sale of residual 18.24 per cent equity in Maruti Udyog in a phased manner, they added.

The move is part of efforts to garner resources for social sector schemes, to which the Manmohan Singh government is according the highest priority.

According to the present share prices, 5 per cent equity sale in BHEL may fetch about Rs 950 crore (Rs 9.50 billion) to the government.

Likewise, the value of government equity in Maruti at current prices is more than Rs 2,445 crore (Rs 24.45 billion).

"The public offers for both the companies are likely to be completed this fiscal," sources said.

With heavy industry ministry, under whose administrative control the two companies fall, favourably inclined towards divestment, finance ministry may float a proposal for consideration of the Union Cabinet either later this month or early February, sources said.

After selling five per stake in BHEL, government stake in the company would come down to 62.72 per cent from 67.77 per cent at present.

Post Maruti IPO, government stake in the automaker had come down to 18.24 per cent. It had an option till June this year to sell its 18.24 per cent stake in the manner it would have liked.

Instead of selling its stake in Maruti to Suzuki, government is inclined to offload it in the open market. Maruti's shares today ruled at Rs 446.40 while the BHEL scrip was priced at Rs 760.