Best call: Tata Teleservices eyes entry in the top bracket by 2011
The Economic Times - September 4, 2006

Tata Tele-Services (TTSL) may have been the last of the major cellular operators to roll out services, but the Tata-owned Telco aims to be among the top two players by '11. Having charted an ambitious growth strategy, the unlisted telecom firm is eyeing to have nearly 100m subscribers in the next five years. The Tata group is known to be among the industry leaders in sectors where it has presence, like steel, power and automotive." Tatas don't enter a market to be number five or six. We have to be number one or two. We have a scenario that'll get us there by '11," TTSL CEO Darryl Green told ET. TTSL is now the fifth largest cellular operator with a subscriber base of over 12m and revenues of over $1bn. It added around 1.1m subscribers in August. The company has been increasing users by 0.5-1m every month since October last year after it changed the telecom industry dynamics by introducing free lifetime incoming plans.

TTSL has outlined a capex of Rs 4,000 crore for the current fiscal and plans to rope in 18m users by March '07. The company has already pumped in over Rs 1,000 crore in the first four months of FY07. "We plan to invest Rs 4,000 crore this year," Mr Green said. The investment is being funded through borrowings from banks and from the money raised from a stake sale to Temasek Holdings. TTSL had sold 9.9 per cent stake to Temasek in March '06. While the deal size was not disclosed, it was estimated at around $300m.

TTSL, which offers telecom services under the Tata Indicom brand, currently has 6,500 base stations across the 20 circles where it operates. "We plan to add over 3,000 stations during this year (fiscal)," said Mr Green. Of these, at least 1,500 sites will be on a sharing basis. TTSL shares its passive infrastructure (base stations) with Bharti Airtel, Hutchison Essar and Idea Cellular. Besides, TTSL is also expanding its retail operations and introducing new handsets with enhanced features.

"The entry-level is a mushrooming segment for us and we will give a variety of phones, as much variety as GSM," said Mr Green. TTSL is also in talks for outsourcing its passive infrastructure as new players get ready to build and operate base stations. "I have no interest in tying up my capex in cell sites. A lot of companies in India are building them. We are listening to them," he added.