BSNL may go for listing, to shelve divestment plan for now

Fearing opposition by employee unions, the government is considering to list telecom major Bharat Sanchar Nigam (BSNL) on bourses by issuing nominal fresh shares and may shelve plans of directly divesting its equity for the time being.

Repeated attempts by the government and also management of the PSU have failed to bring the different associations to consensus on divesting government stake even as they (employees) have been lured with employees stock options at an attractive terms.

"We may first list BSNL on stock exchanges and then go for disinvestment," a senior government official told PTI.

BSNL's valuation has been pegged at about $100 billion and the PSU has a paid up capital of about Rs 5,000 crore.

The PSU has reported a lower net profit of little over Rs 574 crore with total revenues of about Rs 36,000 crore during 2008-09.

Its revenue and net profit in the previous financial year were Rs 38,000 crore and Rs 3,000 crore respectively. The sharp erosion in both revenue and profits is mainly due to lower average revenue per user (ARPU) vis-a-vis the private operators and if the trend continues for few years the company's long term plans may suffer badly.