Raja to review BSNL`s profit plunge, IPO plans
The government will take stock of BSNL`s poor financial showing - wherein net profit fell to Rs 104 crore in FY`09 compared to over Rs 3,000 crore a year ago - and review disinvestment plans.
New Delhi: The government will take stock of BSNL`s poor financial showing - wherein net profit fell to Rs 104 crore in FY`09 compared to over Rs 3,000 crore a year ago - and also talk to the management for selling government stake in the telecom company.
Telecom Minister A Raja has convened a review meeting of
BSNL tomorrow, top ministry sources said, adding that the
agenda includes listing and disinvestment in the telecom PSU.
When contacted, BSNL Chairman and Managing Director
Kuldeep Goyal said: "Increased expenditure due to
implementation of sixth pay commission and falling revenues
from landline operations resulted in a dip in net profit."
Sources said this was the right time for offloading
equity in BSNL as the government can get good value, besides
bringing in private or foreign company to manage operations of
the PSU more efficiently.
The income of BSNL in 2008-09 stood at Rs 34,937 crore,
the government had informed Parliament last week.
The government cited higher staff costs - upward revision
of pay and merger of 50 per cent IDA with the basic pay - for
fall in profit, besides decline in income from services.
Revenue from basic services dipped by 20.65 per cent in
2008-09 to Rs 11,505 crore from Rs 14,499 crore in 2007-08.
As per the restructuring plans, BSNL has proposed to set
up a separate division of sales, marketing and customer care
operations on the advise of Boston Consulting Group, with a
motive to improve its services and boost sales revenue.
To a query on WiMax services, BSNL CMD said that the
expression of interest (EOI) for launching this service on
franchise base would soon be called for rolling out WiMax
services in the country.
"We have already rolled out these services in 1,000
blocks and now for remaining 5,000 blocks, bids will be called
soon wherein revenue will also be shared with franchise," he
BSNL had deferred its plans of launching WiMax services on
a franchise basis after it was found that the five of six
companies which submitted their bids existed only on papers.
On being asked about its IPO launch, Goyal said the
company is awaiting the decision of the government to go ahead
with the intial public offer. "The matter is with the Centre
and we are waiting for their approval on this matter," he
Goyal said that the company had planned to invest a sum of
Rs 15,000 crore as capital expenditure and is aiming at a
growth rate of 15-20 per cent in revenue in this fiscal.