BSNL eyes Rs 3000 crore profit this fiscal

Bharat Sanchar Nigam Ltd (BSNL) expects to post a net profit of Rs 3,000 crore in the current fiscal against a net profit of Rs 1,440 crore in the previous financial year.

The public sector telecom service provider has witnessed an increase in average revenue per user to Rs 560 per month from Rs 500 per month in the previous fiscal.

The expected doubling in profit this year is attributed largely to the over Rs 1,500 crore that the corporation had to pay in wage costs last year.

BSNL had to pay two years of wage increase arrears last year after the Department of Telecommunications became BSNL.

BSNL expects to close the current fiscal with a turnover in excess of Rs 28,000 crore which would be five per cent higher than the turnover in fiscal 2002-03.

Participating at a media workshop on 'Emerging telecom scenario in the country' in the city, BSNL's chairman and managing director Prithipal Singh said the company is targetting to add six million users in the current financial year.

He said, "We would be adding three million users in the mobile telephony services and around a million users for fixed lines."

The rest is expected to come from limited mobility services. BSNL already has a customer base of 40 million for all its services put together. Singh said close to 2.5 million users has already been added in the mobile telephony services.

He, however, added that the fall in the fixed line subscription was only a passing phase.

"In two year time we expect the demand for fixed line services to increase," he said.

This, he said, would be possible with the launch of the value-added services on the broadband that would enable better voice and data transmission over fixed lines.

Singh said that the capital expenditure for the current year is expected to be Rs 12,000 crore with limited support from the government for creating network in rural areas. "Our capital expenditure for the next financial year would be around Rs 14,000 crore," he said.

He added that even if the government's support in terms of reimbursing licence fee for services in the rural areas stop flowing in after the Tenth Five Year Plan, BSNL was geared to meet its investment needs from internal accruals and market borrowings. The first phase in launching a 'convergence billing system' should be ready in the next two months.

"We expect to provide a single bill for all our services including basic and value-added services. To begin with, we expect to provide a single bill that would include the interconnect charges in the next two months," Singh said.

BSNL is also planning to add one customer service call centre at 26 of its major circles. BSNL officials were not able to give any definite time frame by which this initiative will be completed.

The average capital cost for BSNL's global system for mobilephone lines has dropped to Rs 4,000 per line from Rs 8,000 per line over the last two years. Singh said this has enabled BSNL to add twice the number of lines today for the same cost incurred two year ago.