×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

BSNL, NHPC plans show tide has turned

BSNL, NHPC plans show tide has turned
Comment E-mail Print Share
First Published: Sat, Aug 09 2008. 12 00 AM IST
Updated: Sat, Aug 09 2008. 12 00 AM IST
Mumbai: The country’s largest phone services firm by sales, Bharat Sanchar Nigam Ltd (BSNL), and largest generator of electricity from water, NHPC Ltd, plan to raise more than $10 billion (Rs42,200 crore) in share sales, leading a revival in offerings as stocks rebound from the worst start to the year in three decades.
The government plans to sell as much as 10% of BSNL, chairman Kuldeep Goyal said on Thursday. State-run NHPC had on 6 August sought regulatory approval for a sale.
Finance minister P. Chidambaram had said on 24 July that the government will resume asset sales to raise funds for former oil, power and telecom monopolies.
“Investors do find comfort with public sector IPOs (initial public offerings) since most of the companies are long standing and price reasonably,” said Ravi Sardana, senior vice-president at ICICI Securities Ltd. “Names like BSNL and Oil India are quite well known.”
BSNL is valued at about $100 billion, finance director S.D. Saxena said. That’s one-third more than the combined market value of Bharti Airtel Ltd, Reliance Communications Ltd, and Idea Cellular Ltd, the country’s largest listed telecommunications companies.
Reliance Infratel Ltd, a telecommunications tower company controlled by Anil Ambani, and real estate developer Emaar MGF Land Ltd, were among companies that cancelled offerings in the first six months as the benchmark Sensex slumped 34%, the biggest first-half drop since the index was created in 1979.
The BSNL offer may be the biggest by an Indian firm.
Prime Minister Manmohan Singh is reviving sales after winning a confidence vote in the Parliament triggered by the withdrawal of support of Communist parties.
The Communists had opposed asset sales and the opening up of banking, insurance and pensions sectors to foreign investment.
Still, the government will need to secure approval from unions to complete the offerings. BSNL’s labour groups have rejected an offer that would have given each of the company’s 300,000 employees 500 shares at Rs10 apiece.
The government also plans to sell shares in exploration firm Oil India Ltd and Rites Ltd, the company involved in transport and infrastructure technology.
Comment E-mail Print Share
First Published: Sat, Aug 09 2008. 12 00 AM IST
More Topics: BSNL | NHPC | Stocks | ICICI Securties | Oil India Ltd |