Iti Plans Rs 100-Crore Pvt Placement Of Bonds

Indian Telephone Industries (ITI), the Bangalore-based public sector telecom giant, is planning a Rs 100-crore private placement of bonds.

The launch is scheduled for the third week of March. Preparations for the bond issue, dubbed as the C-Series, is underway and the PSU is in the process of selecting the merchant banker for the issue. A company source said that after the A-Series and the B-Series bonds (launched in 1986 and 1987 respectively), this would be the third foray of the cash-strapped ITI into the bond market.

The bond would have an interest coupon rate of 15 per cent per annum, would be of medium term maturity and redeemable after five years.The bond would also have the additional feature of a call and a put option after three years. An ITI official said the money is being raised to meet the capital expenditure of the various projects undertaken by the company

 

ITI with an asset base of around Rs 600 crore figures in the list prepared by the Disinvestment Commission headed by G V Ramakrishna.

From a continuously profit-earning company since its inception over four decades ago, ITI's performance has plummeted since 1994.

By the end of 1995-96, it had accumulated a loss of Rs 366 crore and slipped into a negative net worth position.

The first six months of 1996-97 have not been any better with the company posting a loss of Rs 117 crore

An telecommunications expert group set up by the government has projected that the basic services network in the country is expected to grow from 12.2 million lines to 31 million lines by the year 2001.

Of this, the group expects the public sector to be able to provide 22 million lines by 2001.