Download - Privatization Impacts on PTCL
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Presented By:
Umair Ahmed
Roll No: 164
B.B.A (Hons.) 7th
Evening
Presented To:
Department of
Management sciences
University of Education
Okara Campus
Impacts of Privatization
on PTCL
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Outline
Research Question
Goals of Research
What is Privatization?
Etisalat
Analysis And Findings
Conclusion And Recommendations
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Research Question
What is impact of privatization on PTCL?
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Goals of Research
Impact on Performance
Impact on Competition
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What is Privatization?
“It is the process of selling government assets to
private buyers”.
Privatization is process of transferring ownership of
a business, enterprise, agency or public service from
the public sector (government) to the private sector
(business). In a broader sense, privatization refers to
transfer of any government function to the private
sector including governmental functions like
revenue collection and law enforcement.
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Etisalat
The UAE based company that purchase 26% of
shares with management rights.
It’s Vision:
A world where people’s reach is not limited by
matter or distance.
It’s Mission:
To extend people’s reach
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Analysis And Findings
Privatization Process of PTCL
Impacts of privatization on PTCL
Impact on Performance
Impact on Competition
Impact on Employment
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Privatization Process of PTCL
1. In 1991 Govt decide privatize PTCL, by
selling 26% shares with management rights.
2. In 1994 12% of its shares are divested.
3. In 1994 Govt issued 1 million exchangeable
vouchers, equal to 100 million shares of
Rs.10each for Rs.3 billion .
4. In September 1994 five million vouchers
has been issued to 31 international investors
for $ 900 million.
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Privatization Process of PTCL
5. In 1997 notes of $150 million are issued to
international investors which are
convertible to “A” class ordinary shares,
which are equal to 3.3% of total share
capital.
6. In 1998 Govt hire M/s Goldman
International to provide advisory services.
7. According to M/S Goldman Report, PTCL
handed over to Etisalat, That purchase 26%
shares with management rights.
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Impacts of Privatization on PTCL
Impact on Performance
Impact on Competition
Impact on Employment
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Impact on Performance
Liquidity
0
0.5
1
1.5
2
2.5
3
2004 2005 2006 2007 2008 2009
Current
Quick
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Continued...
Leverage
-20
0
20
40
60
80
100
2004 2005 2006 2007 2008 2009
The Time Interest Earned
Rstio
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Continued...
Profitability
-10.00%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
2004 2005 2006 2007 2008 2009
Operating Profit Margin
Net Margin
Return on Equity
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Continued...
EPS
-1
0
1
2
3
4
5
6
7
2004 2005 2006 2007 2008 2009
EPS
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Continued...
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Continued...
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Continued...
Dividend paid in five years
0
5000
10000
15000
20000
25000
30000
2004 2005 2006 2007 2008 2009
Dividend
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Impact on Competition
With privatization of PTCL may competitors
entered into the market and PTCL’s market
share is day to day decreases, due to the
following reasons:
People switch toward cellular phones
WLL users switch toward wateen, world
call and Tele Card because of better
quality.
Customer services are better then PTCL
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Continued...
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Continued...
However it is in favor of PTCL that it still
has almost monopoly in landline subscribers
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Impact on Employment
Before Privatization :
PTCL has approx. 65000 employees before
privatization.
The main workforce of the PTCL is
unqualified and unskilled. About 50%
employees are under graduate.
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Continued...
After privatization the following decisions
have taken by management:
Launch VSS (voluntary separation
scheme), under this scheme PTCL has to
pay a lump sum amount to employee who
is willing to leave.
Step forward to facilitate equal
employment opportunities.
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Continued...
Inducting fresh blood from the
market
T & D department organized a
comprehensive six months
“Urgent Training Needs”
program in technical and
managerial fields to enhance soft
skills.
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Conclusion
Privatization of PTCL have both positive and
negative impacts.
Some negative impacts are:
The number of subscribers are decreases year to
year because of, poor quality of services, old
technology and higher prices.
PTCL is in the process of layoff and provides a
huge some for this purpose while competitors
have skilled Personnel and offers attractive
packages.
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Continued
Besides these negative impacts PTCL also have
some positive impacts:
PTCL introduced new technology in some
areas.
Improve customer services
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Recommendations
I Recommend PTCL to:
To Improve quality of services
Introduce new products
Introduce new technology
Improve customer services