MTNL Shares Surge As Non-Core Asset Monetisation Begins

Six properties owned by state-controlled telecom companies Bharat Sanchar Nigam and Mahanagar Telephone Nigam have been placed up for sale on the MSTC platform, as the government moves to auction non-core assets. Shares gained over 6% as the government has begun monetisation of non-core assets through auction.

The Department of Investment and Public Asset Management (DIPAM) launched the non-core asset monetisation process, inviting bids to sell six assets of state-run telecom firms Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) through its new asset monetisation platform.

According to sources, the government has put telecom companies' real estate assets for sale at a reserve price of about 1,100 crore.

After it was announced that the government intended to restart the company, shares of MTNL jumped as much as 15% to 20.70 on November 18, their highest intraday rise since March 10. MTNL's stock has increased 44.73 percent so far this year. Since last year, the stock has generated 106% returns.

Property owned by BSNL in Hyderabad, Chandigarh, Bhavnagar, and Kolkata has been put up for sale at a reserve price of Rs 800 crore.

MTNL assets at Vasari Hill, Goregaon, Mumbai, have been placed for sale on the Department of Investment and Public Asset Management (DIPAM) website for a reserve price of around Rs 270 crore.

As part of the company's asset monetisation programme, MTNL's 20 flats in Oshiwara have also been placed up for sale.

Other PSU assets, such as BEML and the Shipping Corporation of India, may be next, as the carve-out of their non-core assets is included in the preliminary information memorandum for strategic disinvestment.

Under the Rs 6 lakh crore National Monetisation Pipeline, the government has also shortlisted various central government projects.

For the fourth quarter in a row, the company has lost Rs 654.56 crore. Stock returned 39.93 percent over three years, compared to 75.74 percent for the Nifty Smallcap 100. Over a three-year period, the stock returned 39.93 percent, compared to 70.35 percent for the S&P BSE Telecom index.