The Department of Disinvestment (DoD) has appointed PricewaterhouseCoopers (PwC) for evaluating Videsh Sanchar Nigam Ltd's (VSNL) assets before the centre divests its stake in the company. This will also include some odd 1000 acres of land all over the country that VSNL had taken on lease for creating infrastructure facilities. This was subsequently transferred to the company.
"However, valuation of a company should also be based on the perception of investors, and the present valuation of the company on the basis of its scrip is grossly under valued," said chairman and managing director S K Gupta.
"We did not do anything exceptional when our scrip prices rose to Rs 500, neither did we do anything that would have brought down prices to Rs 300," he said.
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Speaking at a press conference, here on Wednesday, S K Gupta said the process of disinvestment in VSNL by all means will not be executed before December this year. Divestment in VSNL will be made only after the central government issues guidelines for international telephony.
Telecom Regulatory Authority (Trai) has issued a consultation paper, which will be followed by Trai meetings in Chennai, Mumbai and Delhi only after which the centre will issue guidelines for international telephony.
Meanwhile, two of the three bidders' for VSNL has asked for a second round of due-diligence in the company. The three bidders in VSNL are the Tata's, Reliance and BPL. "The process of second round of due-diligence will shortly begin," he added.
Taking on international telephony, Gupta said that we would recommend drastic cuts in international telephony charges once the sector is opened to private players. Competition in the sector will rise as a result, but total volumes will definitely rise, he added. Gupta also said that before Internet telephony is legalised, international call charges should be reduced by 50 per cent.
This year VSNL expects volumes to rise by 20 per cent and is also not averse to the idea of leasing its infrastructure to private players once the sector is opened.
Meanwhile, VSNL is also targeting its VRS for its 500 employees in its telegraph and telex department.