Source: Moneycontrol.com
Showing posts with label BSNL IPO. Show all posts
Showing posts with label BSNL IPO. Show all posts
Tuesday, September 23, 2008
BSNL union feedback positive on IPO: Telecom Min
Telecom Ministry says that BSNL union feedback is positive on IPO, but has some reservations, reports CNBC-TV18
Thursday, August 28, 2008
BSNL IPO issue dropped from board meeting agenda
The Board of state-run BSNL today skipped discussion on its proposed public offer as the company is still trying to make the employees union agree to dilution of equity. However, the ITI-BSNL merger issue, which is also opposed by the union, came up for discussion.
Source: Congoo.com
Source: Congoo.com
Thursday, August 21, 2008
General insurers may be allowed to tap capital market
The Initial Public Offering (IPO) of Bharat Sanchar Nigam Ltd (BSNL) is expected to take precedence over the capital raising proposals of the public sector general insurance companies.
Sources said that the Government was not opposed to the capital raising plans of the four general insurance companies — New India Assurance Company Ltd, National Insurance Company Ltd, Oriental Insurance Company Ltd and United India Insurance Company Ltd.
The plans are now awaiting amendments to the General Insurance Business (Nationalisation) Act of 1972 and the Insurance Act of 1938.
But clearance for the capital raising efforts is likely only after completion of the Rs 42,000-crore BSNL’s mega IPO. The sources said that the Government’s efforts were to push through with the 10 per cent divestment in BSNL. The BSNL focus was largely driven by the ticket size, the sources said.
The large ticket size would help the Government raise large resources and partly help in complying with the fiscal deficit targets for the current year, estimated at 2.5 per cent of the Gross Domestic Product.
Of smaller size
Raising of resources by general insurers through a combination of capital restructuring and IPOs would, however, be of far smaller magnitude.
The smaller ticket size notwithstanding, the sources said, indications are that the insurers would be permitted to access the domestic capital markets this financial year itself. This was particularly in view of general insurers’ urgency in capital requirements for growing their business.
Besides, general insurers also have pressed the need to reduce reliance on cross border risk capacities for conforming to regulatory solvency margins.
Solvency margin
At present, the regulator’s prescribed solvency margin is 150 per cent. Solvency margin implies the excess of capital and value of assets over the insured liabilities. At present, the PSU general insurers have solvency ratios in excess of two times over their insured liabilities.
However, this was largely in view of the low insurance penetration. The general insurance market is currently about Rs 35,000 crore or about 0.65 per cent of the Gross Domestic Product.
The Asian average is about 3 per cent of the GDP. Stepping it up to Asian levels, the sources said, would require capital infusion.
The combined net worth (paid-up equity + general reserves) of the four PSU insurers is currently about Rs 13,000 crore.
Besides, the sources said, valuation exercises for the four companies are yet to begin. New India Assurance, Oriental Insurance and United India Insurance have hired the Boston Consulting Group as external consultants. National Insurance has appointed PwC as its consultant.
The sources said that the consultants would not be valuing the companies.
But the process for beginning a valuation would be in place even as the amendments to the statutes are completed over the next few months, the sources added, reports The Hindu Business Line.
Source: Moneycontrol.com
Sources said that the Government was not opposed to the capital raising plans of the four general insurance companies — New India Assurance Company Ltd, National Insurance Company Ltd, Oriental Insurance Company Ltd and United India Insurance Company Ltd.
The plans are now awaiting amendments to the General Insurance Business (Nationalisation) Act of 1972 and the Insurance Act of 1938.
But clearance for the capital raising efforts is likely only after completion of the Rs 42,000-crore BSNL’s mega IPO. The sources said that the Government’s efforts were to push through with the 10 per cent divestment in BSNL. The BSNL focus was largely driven by the ticket size, the sources said.
The large ticket size would help the Government raise large resources and partly help in complying with the fiscal deficit targets for the current year, estimated at 2.5 per cent of the Gross Domestic Product.
Of smaller size
Raising of resources by general insurers through a combination of capital restructuring and IPOs would, however, be of far smaller magnitude.
The smaller ticket size notwithstanding, the sources said, indications are that the insurers would be permitted to access the domestic capital markets this financial year itself. This was particularly in view of general insurers’ urgency in capital requirements for growing their business.
Besides, general insurers also have pressed the need to reduce reliance on cross border risk capacities for conforming to regulatory solvency margins.
Solvency margin
At present, the regulator’s prescribed solvency margin is 150 per cent. Solvency margin implies the excess of capital and value of assets over the insured liabilities. At present, the PSU general insurers have solvency ratios in excess of two times over their insured liabilities.
However, this was largely in view of the low insurance penetration. The general insurance market is currently about Rs 35,000 crore or about 0.65 per cent of the Gross Domestic Product.
The Asian average is about 3 per cent of the GDP. Stepping it up to Asian levels, the sources said, would require capital infusion.
The combined net worth (paid-up equity + general reserves) of the four PSU insurers is currently about Rs 13,000 crore.
Besides, the sources said, valuation exercises for the four companies are yet to begin. New India Assurance, Oriental Insurance and United India Insurance have hired the Boston Consulting Group as external consultants. National Insurance has appointed PwC as its consultant.
The sources said that the consultants would not be valuing the companies.
But the process for beginning a valuation would be in place even as the amendments to the statutes are completed over the next few months, the sources added, reports The Hindu Business Line.
Source: Moneycontrol.com
Friday, November 23, 2007
BSNL to launch an IPO next year
State-owned telecom firm, BSNL could come out with an initial public offer within the next one year. The idea behind the stock market listing is not so much to raise capital, as to put a value to the company, reports CNBC-TV18.
It could well be the mother of all Indian IPOs, if it happens at all. Caution is warranted because this is not the first time that state-owned Bharat Sanchar Nigam is considering an IPO. A top company official said one could expect it over the next 6-12 months.
It has been learnt that 20% of equity might be on offer. The valuations border on the fantastic. A company finance official quoted a figure of USD 100 billion. That is almost double the value of Bharti Airtel, whose market cap is about USD 45 billion. And Anil Ambani-owned Reliance Communications is valued at USD 35 billion.
BSNL has a much wider network and boasts of 65 million subscribers. Many of them are fixedline customers, who run up higher phone bills on an average than mobile users. Over the last 6-8 months, BSNL's performance has been muted on account of capacity constraints, but it is trying to get the better of market leader Bharti Airtel.
According to Kuldip Goyal, CMD, BSNL, “In about two months from now, Ericsson’s supply of equipment will start after that we should also be easily hitting the two million figure." The company is in the process of cleaning up its books and is likely to appoint an advisor to the IPO soon.
The company's previous attempt at a stock market listing did not take off because the previous Telecom Minister, Dayanidhi Maran, was not in favour of it. But current Minister A Raja is said to be not averse. The idea behind the stock market flotation is to discover the value of the company, not so much to raise capital.
Source: Moneycontrol.com
It could well be the mother of all Indian IPOs, if it happens at all. Caution is warranted because this is not the first time that state-owned Bharat Sanchar Nigam is considering an IPO. A top company official said one could expect it over the next 6-12 months.
It has been learnt that 20% of equity might be on offer. The valuations border on the fantastic. A company finance official quoted a figure of USD 100 billion. That is almost double the value of Bharti Airtel, whose market cap is about USD 45 billion. And Anil Ambani-owned Reliance Communications is valued at USD 35 billion.
BSNL has a much wider network and boasts of 65 million subscribers. Many of them are fixedline customers, who run up higher phone bills on an average than mobile users. Over the last 6-8 months, BSNL's performance has been muted on account of capacity constraints, but it is trying to get the better of market leader Bharti Airtel.
According to Kuldip Goyal, CMD, BSNL, “In about two months from now, Ericsson’s supply of equipment will start after that we should also be easily hitting the two million figure." The company is in the process of cleaning up its books and is likely to appoint an advisor to the IPO soon.
The company's previous attempt at a stock market listing did not take off because the previous Telecom Minister, Dayanidhi Maran, was not in favour of it. But current Minister A Raja is said to be not averse. The idea behind the stock market flotation is to discover the value of the company, not so much to raise capital.
Source: Moneycontrol.com
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