BSNL IPO - coming soon ?

In what could be the mother of all IPOs, public sector BSNL, India’s largest telecoms company, is looking at divesting about 20% within the next 12 months. The catch is the plan can take off only if the government were to approve the plan.

Sources said BSNL, which has over 65 million users, could be valued at close to $100 billion, which puts a 20% stake dilution at $20 billion — the largest that the country has witnessed so far.

It must be pointed out that this is not the first time that BSNL is planning an IPO. Its earlier requests for listing have all been turned down by the government. BSNL had put its IPO plans on the back burner after former communications minister Dayanidhi Maran had rejected the proposal last year.

This time around, BSNL executives expressed more confidence and are of the view that the present communications and IT minister A Raja may not be against the proposal. BSNL is yet to present the idea of listing to Mr Raja.

If the communications ministry were to approve the proposal, BSNL will undertake a process for cleaning up its books and also appoint an advisor to for the IPO within the next couple of months. It must also be pointed out that sister company MTNL, which offers services in both Delhi and Mumbai, is a listed company.