SD Saxena, Director-Finance, BSNL, said the 5-10% stake sale is a possibility but Government's call will be final. He sees chances of the IPO happening within the current financial year itself.

He sees FY09 revenues at Rs 45,000-50,000 crore. BSNL has paid up equity of Rs 5,000 crore.

Kuldip Goyal, CMD, BSNL, said a 10% dilution maybe considered. So, how will employees benefit? He said, “Once the company gets listed, it will be in public domain. Its valuations will then be comparable with its peers, as right now it is not being monitored. Employees will receive ESOPs, so it is in their interest that the company gets listed.”

Excerpts from CNBC-TV18’s exclusive interview with SD Saxena:

Q: The IPO (Initial Public Offering) has evinced a lot of interest. Any idea of what kind of valuations we are looking at? Do you have any timetable however vague in mind?

A: It’s little premature to value the issue at the moment. It can be in a price band of more than Rs 300. So, we are offering an ESOP (Employee Stock Option Plan) to the employees which will be around 500 shares and that will come to around 1.25 - 1.5 lakh to each employee. The honourable minister said that in the press conference and we stand by that.

Q: If the price band is likely to be at Rs 300, how much will be on offer from the government. Will it be a divestment?

A: That is the prerogative of the government and perhaps 5-10% is a possibility. I will leave it to the government.

Q: Is it a divestment plus a fund raising or will it only be a divestment?

A: It’s clearly both but we will have to see how the market shape up because it is not going to be immediate as you might have heard in the press conference today.

Q: Are you are expecting it in this financial year?

A: That’s right.

Q: Have you worked out any kind of valuations? Have you had any talks with any merchant bankers now or in past?

A: The valuations are a little tricky thing. Even if we work it out it may not be appropriate at this moment to declare it because it will go by the market and a lot of situations. It will be more than Rs 300 at the moment but then the market will value it.

Q: Can you give us a ballpark figure as to how many shares would you be offering under this?

A: It is 10%. If the company being assessed has a market-cap is USD 100 million then it will be close to USD 10 billion. There is much said by the honourable minister I do not have to add much.

Q: There was a proposal by ITI (Indian Telephone Industries Ltd) for a merger with BSNL. Have you taken any viewpoint on that? Has that been discussed by the board?

A: It was discussed and pointed out. There is a committee called Nitish Sengupta Committee which is going into it and we await the response from the committee.      

Q: What are BSNL’s revenues likely to be in the current year and what were they in FY08?

A: We will be definitely making Rs 45,000-50,000 crore, that’s our estimate.

Q: What would be the paid up equity of the company?

A: At the moment, the government paid up equity is around Rs 5,000 crore.