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Bharat Sanchar Nigam Limited (BSNL), state-run telecom has announced that it will be initiating the process of selling 10,000 mobile towers as part of the company's monetization plan.
In July 2022, we at Jobaaj reported about the massive Rs 1.64 trillion package that the Central government had announced for the revival of BSNL. The revival package also included a scheme of Rs 26,316 crores to extend 4G telecom services to 25,000 villages.
The four-year turnaround package, which aims to make BSNL profitable by FY2026-27, consisted of a Rs 44,000 crores of cash component while the balance was non-cash assistance such as spectrum allocation, a bond issue with a sovereign guarantee, AGR dues conversion to equity, viability gap funding, etc.
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The package was announced with an aim to help the distressed telecom network improve its balance sheet, better its landline network, and offer 4G services.
"BSNL is a big turnaround story. It has made an operating profit. Customer attrition has stopped and its market share is stable at 10 percent. That is giving us hope and confidence. Net profit will be made once revenue improves and the balance sheet is restructured,” Telecom Minister Ashwini Vaishnaw had said at the time.
According to a report by the Economic Times, KPMG has been hired as the financial advisor for the sale, the value of which has been pegged at around Rs 4,000 crores, although the same has not been confirmed.
The company is selling those towers with which it has co-location arrangements with other telecom providers. To achieve the targets set in the monetization plan, the company must sell 13,567 towers by FY2025.
However, the road to revival is challenging as BSNL is severely lagging behind its private peers. The company has been shelling out losses for a while as its five-year cumulative loss came up to Rs 50,631 crores!! In June 2022, the company had less than 10% share in the Indian telecom market.
Moreover, BSNL hasn't even rolled out its 4G offerings yet, at a time when the implementation of 5G services is visible in the near future.
With 18-24 months still left in the launch of its 4G offerings, BSNL would lose more subscribers to private players as its revival appears to be a Herculean task.
Article by Aman Agarwal.
This story is brought to you in association with Jobaaj.com
