Mahanagar Telephone Nigam Limited (MTNL), a state-run telecom operator, has informed to the stock exchanges that it is going to sell its residential property in Mumbai's BKC (Bandra Kurla Complex) area. This is a major step towards MTNL asset monetisation. The thing with MTNL is that it is not performing well enough to pay off liabilities and keep growing the business. There's constant subscriber loss, along with dipping revenues and rising debt.
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Thus, the government decided that it would be better to sell of non-performing land assets to generate cash to clear liabilities as much as possible. MTNL will sell Rs 350.72 crore worth residential property to the National Bank for Agriculture and Rural Development (NABARD), and has received a clearnance from its board for the same.
Talking about the property here, it has 28 residential units spread across 2,680 square meters. This sale will be treated as either a government to government sale or a direct sale to the NABARD. The government is aiming to collect Rs 4,753 crore from MTNL's assets while BSNL will aim to collect Rs 900 crore.
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For what's the future of MTNL and BSNL, there are no plans by the government to shut down either of the brands. There are efforts to revive the company and improve efficiency of operations. The asset monetisation was part of the revival package announced by the government for the telcos. BSNL has been able to turn things around for itself in the recent past. It has managed to not only post net profits for consecutive quarters, but has also added new subscribers when the private telcos have lost them. The cheaper tariff structure from BSNL is making it a go to option for consumers for their secondary SIMs in India.
