Bangalore transport dept takes bus to share market

BMTC GOES PUBLIC: The 683 crore state undertaking hopes to have the IPO out by the end of this year.

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Bangalore: With over 4,500 buses doing close to 9.5 lakh kilometres every day, the Bangalore Metropolitan Transport Corporation (BMTC) is one the most profitable government departments in Karnataka.

However, the journey's only half done for the BMTC, which now plans to go public with the first ever IPO from a state-owned transport undertaking. The public bus service plans to offer 30 crore shares at a face value of Rs 10 at a premium, which is yet to be decided.

The BMTC hopes to raise Rs 4,000 crore through the offering.

Says BMTC Managing Director, Upendra Tripathy, "The capital will allow the corporation to provide ultra modern buses and this is the only way to attract commuters who otherwise travel by two-wheelers and cars."

The proposal aims to allot more than 10 crore shares to the State and Union governments and the remaining 20 crore shares to the public. The proposal is yet to get the government nod.

But BMTC regulars are looking forward to the IPO.

They say that the BMTC is doing very well and that last year they made a profit as well. Most regulars say that provided BMTC goes in for disinvestment, they would be very happy to take shares.

Nonetheless they say that everything depends on the premium.

The 683 crore state undertaking hopes to have the IPO out by the end of this year or in early next year.