IPO on the back burner: BSNL CMD

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New Delhi, Apr 24 (UNI) State-run Bharat Sanchar Nigam Ltd (BSNL) today said it postponed its planned IPO as it had sufficient funds for its expansion plans.

''The issue has been put on the backburner. As of now, we have sufficient funds,'' BSNL CMD Kuldeep Goyal told reporters here on the sidelines of BSNL's Integrity Pact program.

The IPO will be brought in when the need arises, he added.

BSNL had, in January this year, announced its plans of launching an IPO to raise about Rs 40,000 crore.

This would have been the country's largest IPO. Anil Ambani promoted Reliance Power which raised over Rs 11,000 crore from the markets has been the largest IPO in the country till now.

However, its proposed plan to enter the capital markets had been met with a strong protest from its employees union.

Analysts, on the other hand argue that the IPO would be to find the value of the company which will be more than Rs 4,00,000 crore or 100 billion dollars.

BSNL has an equity base of Rs 5,000 crore, which translates to a shareholding structure of 500 crore shares at a face value of Rs 10 each.

BSNL had said its IPO would not be a disinvestment, but a dilution of stake by the government through the issue of fresh shares.

BSNL is the country's largest telco by both revenues and subscriber numbers. The PSU, which has over 75 million customers (fixed-line and mobile), had revenues of Rs 39,750 crore in 2006-07, with a net profit of Rs 7,805 crore.

It had said it will invest about Rs 15,000 crore this fiscal to expand its mobile and broadband networks across the country. It has also committed to invest about Rs 60,000 crore by 2010 crore to expand its telecom infrastructure and operations.

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