The government is considering the sale of 10 per cent equity stakes in state-owned Bharat Sanchar Nigam Ltd (BSNL) through an initial public offer of shares.
Communications Minister A Raja signalled the intent when he said in response to questions from reporters at a BSNL function that his ministry was open on the idea.
“We will look into it. The Department of Telecom (DoT) will discuss the issue and take a decision," he said.
However, the issue is controversial, given political opposition to disinvestment by Left parties and also BSNL’s employee union.
When Hindustan Times raised the question of IPO to the Chairman and Managing Director of BSNL, Kuldeep Goyal, he said, “Maybe the ministry is thinking of it.”
“It will be good for the company as people will get to know the real value of the company,” he added with a note of caution.
However, the CMD also said that an IPO cannot be expected in the near future.
The company has large-scale growth plans. It is going to expand its offering on Wireless in Local Loop network (WLL) on the CDMA platform. It will also be soon announcing a 25 million GSM line tender to upgrade its network in the southern India.
Its vendors in the North, East and the West have already taken up the task of upgradation of the GSM line network.
“By end 2008, we hope to retain our number two position in the GSM telephony”, said Kuldeep Goyal. Vodafone Essar had upstaged BSNL from the number two position in 2007. BSNL had lost market share due to unavailability of GSM lines.