State-run Telecommunications Consultants India Ltd’s (TCIL) plan to sell 15% stake in Bharti Hexacom through the latter’s an initial public offer (IPO) will yield around Rs 4,200 crore to the Centre, boosting its dividend receipts from central public sector enterprises (CPSEs).
TCIL, wholly owned by the Centre, will transfer the amount from disinvestment in Bharti Hexacom to the government as a special dividend, sources said. Bharti Hexacom is a subsidiary of the country’s second-biggest telecom operator Bharti Airtel.
The Bharti Hexacom IPO, which only has an offer for sale from TCIL and no fresh equity issue from the company, opened on Wednesday and would close on Friday. The price band has been kept at Rs 542-570 per equity share of face value of Rs 5 each.
TCIL held 150 million equity shares, representing 30% of the pre-offer equity share capital of the Bharti Hexacom. Post IPO, TCIL would still own a 15% stake in Bharti Hexacom, which it would exit at an appropriate time to gain from the upsides in the valuation of the company going forward.
Bharti Hexacom is a communications solutions provider offering consumer mobile services, fixed-line telephone and broadband services to customers in the Rajasthan and the North East telecommunication circles in India, which comprises the states of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland and Tripura. It offers services under the brand ‘Airtel’.
Meanwhile the Centre’s dividend receipts touched a record Rs 63,749 crore in FY24, 27.5% more than the revised estimate of Rs 50,000 crore and 48% more than the budget estimate of Rs 43,000 crore. The higher dividend receipts from CPSEs, due to the rise in profitability in key sectors including petroleum, mining and power, helped the Centre exceed the revised revenue receipts target for FY24.
For FY25, the Centre has set a target of Rs 48,000 crore for CPSE dividends, which it will likely exceed by a decent margin like in the previous year.
On April 1, the government received about Rs 554 crore from Power Finance Corporation Limited as a dividend tranche.
CPSE dividend receipts are an important component of the government’s non-tax receipts. Along with dividends from the RBI, banks and financial institutions, the Centre’s total dividend receipts from all undertakings are expected to have exceeded the revised estimate of Rs 1.54 trillion for FY24 (BE was 0.91 trillion) by a decent margin.
