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BSNL’s strong operating profits suggest a bright future ahead

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In Short:

In recent years, BSNL, a once loss-making telecom operator, has reported operating profits for two consecutive years, with its profits growing each year. The government’s relief packages, including a Voluntary Retirement Scheme for employees and financial support, have helped BSNL lower costs, acquire spectrum, restructure debt, and monetize its assets. With plans to raise funds through government-backed bonds, BSNL aims to become entirely profitable by 2026-27.


BSNL Reports Operating Profits, Signals Positive Future

bsnl operating profits signal a positve future

Bharat Sanchar Nigam Limited (BSNL) has transitioned from being a loss-making company to reporting operating profits in recent years. This marks a significant development as BSNL has witnessed consecutive growth in its operating profits. In the financial year 2021-22, BSNL reported an operating profit of Rs 944 crore, which increased to Rs 1559 crore in 2022-23.

Impact of Government Relief Packages

The key factor contributing to BSNL’s positive performance has been the government’s intervention through relief packages. The Voluntary Retirement Scheme (VRS) for BSNL employees, introduced in 2019, resulted in significant cost savings as over 78,559 employees opted for retirement out of 1.63 lakh.

Subsequent relief packages in 2022 and 2023, totaling Rs 1.64 lakh crore and Rs 89,047 crore respectively, enabled BSNL to acquire spectrum, restructure debt, and monetize assets such as land parcels and office buildings as directed by the government.

Fundraising and Expansion Plans

BSNL intends to raise funds through two 10-year bonds backed by government guarantee, with a targeted amount of about $290.3 million. These bonds, expected to receive a AAA (CE) rating by Crisil, will support BSNL’s initiatives to roll out 4G services and expand its network nationwide.

Future Outlook

With the continued reporting of operating profits, BSNL appears on track to achieve profitability in the near future. The central government has set a target for BSNL to become profitable by the financial year 2026-27, reflecting confidence in the company’s trajectory following the recent relief measures.

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