Abstract
BSNL is a government organization that is a well-established communication company in India. It has offices in every part of the country even in villages. This well-established infrastructure benefits BSNL in many ways, but the same may also have adverse effects also in profitability. Because expenses like maintenance of assets, depreciation, and salary to employees, are fixed in nature, hence increase in operating income will lead to high profitability and lower operating income will lead to loss. Hence study of profitability passion of BSNL is important. For this purpose, the researcher collected accounting data from annual reports of BSNL for the period of ten years from 2005-06 to 2014-15. The researcher used ratio analysis mean and trend analysis as financial and statistical tools. The study found that the profit of BSNL was decreasing during the study period. During the first four years of the study period, it earned a profit and it suffered by loss during the remaining years. Operating performance of BSNL was not good during the study period except during 2006-07. The main reasons for the unsatisfactory performance were the low growth rate of operating income and the drastic increase in employee cost and other expenses of BSNL.
Keywords: BSNL, profitability, expenses, and net profit.
References
- Annual reports of BSNL from 2005-06 to 2014-15.
- John Thomas and Ramesh Damarla (2012), Diagnosing BSNL as a Business – Performance Analysis of a Fully Owned Government Company – A Case Study of Bharat Sanchar Nigam Ltd., The Management Accountant, May 2012, pp.558-564.
- Rajput Vijay M and Richa Shah (2015), A Comparative Study of Financial Performance of BSNL and Idea Cellular Ltd., International Journal of Scientific Research, Vol.4, No.6, pp.228-230.