Tata indicom. Tata Teleservices (Maharashtra) Limited

Transcription

1 Tata indicom Tata Teleservices (Maharashtra) Limited

2 Contents The Tata Group The India Telecom Opportunity Tata Group s Telecom Leadership Play Tata Teleservices (Maharashtra) Limited Key Performance Indicators What makes us Unique 2

3 The Tata Group A Snapshot 1 India s Largest Business Group 2 India s Most Respected Multinational Business Conglomerate* 3 Only Indian Entity in Forbes s list of World s 20 Most Reputed Companies 4 Market Capitalization** of USD 54 Bn, Highest in India 5 FY Revenues (est.)** of USD 27.1 Bn, Profits (est.) of USD 2.4 Bn 6 Largest Employer in the Private Sector with 250,000 Employees** 7 Over 50% of Group Revenues earned from outside India * Awarded in 2006 by the United States-India Business Council (USIBC) ** The Corus acquisition would notionally add, for FY 06-07, USD 19 Bn (est.) to revenues, USD 12 Bn to market capitalization, and 47,000 employees to the Group 3

4 Business Sectors Titan Tata Tea Tata Chemicals Indian Hotels TCS Tata Power Energy, 7% Information Systems & Communications, 20% Consumer Products, 5% Chemicals, 4% Services, 9% Engineering, 31% REVENUE FY 2006 Materials, 23% Voltas Tata Motors Tata Autocomp VSNL TTL Tata Steel 4

6 The Macroeconomic Environment 10% 8% 6% 4% 4% GDP Growth Rate 8% 8% 8% 9% 7.0% 6.0% 5.0% 4.0% 3.0% 3.4% 5.5% Inflation 6.4% 4.4% 5.3% 2% 2.0% 1.0% 0% FY2003 FY2004 FY2005 FY2006 FY % FY2003 FY2004 FY2005 FY2006 FY % 30% 25% 20% 15% 10% 5% 26% Savings Rate as a % of GDP 30% 31% 32% 32% Forex Reserves(USD Bn) % FY2003 FY2004 FY2005 FY2006 FY FY2003 FY2004 FY2005 FY2006 FY2007 By 2032, India will be amongst the three largest economies in the world Sources: RBI, CSO, Goldman Sachs 6

7 Telecom The Story Thus Far Mn Subscribers National Telecom Policy 99 : Introduction of Revenue Share Unified Access Service Licences issued Calling Party Pays Introduced Entry of 3 rd and 4 th GSM Operators CDMA Limited Mobility Entry Micro Prepaid/ Long Validity Plans launched 0 FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 Fixed Mobile Broadband Source: TRAI, COAI, AUSPI 7

8 India outperforms China Source: Study paper on Indicators for Telecom Growth Subscribers value are as at the end of the year (December). 8

9 India Growth Potential Key growth drivers affordability (falling handset prices, lowest tariffs) availability (network, distribution) Source: Based on data in Global Wireless Matrix Merrill Lynch. 9

11 Presence Across the ICT Service Spectrum Wireless Fixed Line Broadband DTH Enterprise Wholesale IT ITeS TTL* VSNL Tata Sky TIEBU VSNL TCS Serwizsol Global No.1 wholesale voice provider 16Mn wireless subscribers, 0.5Mn wireline subscribers India s fastest growing DTH operator World s 12 th largest software services company; software vendor to world s leading telcos and telecom equipment manufacturers 0.2Mn broadband subscribers Serves majority of the Top 1000 enterprise customers in India 3200 seat BPO; supports English, Hindi and 9 Indian languages *Includes Tata Teleservices (TTSL) & Tata Teleservices (Maharashtra) Ltd (TTML) 11

12 Competitive Landscape Wireless Fixed Line Broadband DTH Enterprise Wholesale IT ITeS Tata Group Incumbent Govt. Operators Bharti TTL TTL VSNL Tata Sky TIEBU VSNL TCS Serwizsol India- Centric India- Centric Reliance Hutch Idea Significant Presence Limited Presence No Presence 12

13 Wireless Services The CDMA Advantage Innovative Products & Services Fixed Wireless Phones Best Service in Emerging Markets - World Communication Awards 2005 Mobile Content / Applications Higher bandwidth = better services + enhanced experience Pay Telephony Booths TTL has over 1 Mn high ARPU PTB Wireless Internet TTL is the first to launch ERP access on PDA in India RoadWarrior Mobile VPN Strong uptake from segments such as BFSI, Retail and Lottery PARSEC Payphone +PoS 13

14 Wireless Services Handsets Portfolio Low End / Mass Market Mid End / Youth Market High End TTL offers over 40 handset models from Motorola, Nokia, Samsung, LG, Huawei, ZTE, Haier, Pantech and Kyocera TTL was the first mobile operator to launch handsets under its own brand name in the Indian market Most new handsets being launched are RUIM based and BREW enabled TTL s Instachange Card allows subscribers to change their handset while retaining their number in 3 simple steps TTL subscribers can seamlessly roam across GSM and CDMA networks in 178 countries using dual-mode phones (Worldphones) or One World One Number T-SIM Card 14

15 Wireless Services Distribution Channel India s largest branded telecom retail chain Over 3,300 exclusive outlets, occupying 0.6 Mn Sq Ft of prime retail space Extensive handset distribution reach through presence at over 60,000 multi-brand retail outlets Recharge vouchers distributed through more than 140,000 outlets TTL recently entered the Limca Book of Records by launching 100 exclusive outlets on a single day 15

17 Telecom Operator s Business Lifecycle Infrastructure intensive industry leading to longer gestation period TTML is in the 4 th year of wireless operations Phase 3 Maturity Falling Tariffs Phase 2 Growth mode Highly Regulated Industry Phase 1 Setup Rapid Technological changes making certain assets obsolete Once Once we we get get into into matured matured mode, mode, the the business business starts starts yielding yielding recurring recurring revenue revenue which which impacts impacts positively positively on on the the financials financials of of the the company company 17

18 The Story So Far FY04 Launch FY towns FY towns FY towns Commenced CDMA Wireless operations in Maharashtra Launch of Prepaid Offerings Sub Base crossed 1 million Exited EBITDA Positive Launch of Long Validity Products Became 1000Cr Company Exited Cash Positive Sub Base Crossed 3 million Robust growth in Financials Successful operational turnaround through a fine balance of Market Share and Financials 18

19 Advanced Network Architecture World Class network leads to robust and Reliable operations High resilience of network architecture provides strong platform for scalability Switches Distributed network design optimizes transmission costs Pioneers in RF Awarded for the best performance in Key Network Parameters New Technology RF 19

20 Reaching Out with a Strong Brand Touching lives lives at at every every stage stage Best Best in in Class Class Network Infrastructure Pioneers in in wireless home home phones Providing the the fastest fastest wireless data data services 20

22 FY07 Highlights 1 Subscribers EOP crossed 3 million subscribers : 67% growth over last year 2 Revenue Revenue crossed Rs.1400Cr : 30% growth over last year 3 EBITDA EBITDA crossed Rs.300Cr : 142% growth over last year 4 Cash Profit Cash Profit over Rs.130Crs : 624% growth over last year 5 PBT 74% improvement over last year 22

23 SCORECARD FY07 vs FY06 FY 06 FY 07 % improvement EOP Sub Base (Nos. in lacs) EOP Sub Base (Nos. in lacs) % 67% Total Revenue (Rs.Crs.) Total Revenue (Rs.Crs.) % 30% EBITDA (Rs.Crs.) EBITDA (Rs.Crs.) % 142% EBITDA Margin % EBITDA Margin % 11% 11% 21% 21% 91% 91% Cash Profit (Rs.Crs.) Cash Profit (Rs.Crs.) (21) (21) % 624% PAT (Rs.Crs.) PAT (Rs.Crs.) (541) (541) (311) (311) 74% 74% EBITDA Crosses Rs.300Crs Full Year Cash Profit 23

24 TTML Operations (Q3 FY 06 Q4 FY 07) Subscriber Base Market Share 3,300 3,100 2,900 2,700 2,500 2,300 2,100 1,900 1,700 1,500 1,677 Q3FY05 CAGR 89% 2,104 1,840 Q4FY05 Q1FY06 2,350 Q2FY06 2,711 Q3FY06 3,074 Q4FY % 12.0% 11.5% 11.0% 10.5% 10.0% 10.8% Q3FY % Q4FY % Q1FY % Q2FY % Q3FY % Q4FY06 Cost per Sub Productivity ,700 2,500 2,425 2, ,300 2,100 1,900 1,700 1,699 1,844 2,043 2,164 1,500 Q3FY06 Q4FY06 Q1FY07 Q2FY07 Q3FY07 Q4FY Q3FY06 Q4FY06 Q1FY07 Q2FY07 Q3FY07 Q4FY07 Operational cost per sub is comparable to Industry 24

25 Growing faster than the market Sub Base (mn) 10 O.78 CAGR 52% CAGR 89% Market TTML FY05 FY07 Market growing at CAGR of 52% over last 2 years TTML grew at a CAGR of 89% in the same period 25

26 Enterprise Integrated Play V-Data Fixed Wireless Phone Mobile Market Share Audio Conferencing TTML 42% Office on Mobile Fixed Wired Phone Others 58% ADSL Wireless Access * Wireline & Data Products SMS Based Application Mobile Shopping High capacity Leased Lines 26

27 TTML - Financials (Q3 FY 06 Q4 FY 07) Revenue EBITDA Q3FY06 Q4FY06 Q1FY07 Q2FY07 Q3FY07 Q4FY07 Q3FY06 Q4FY06 Q1FY07 Q2FY07 Q3FY07 Q4FY07 EBITDA Margin PAT 26% 24% 22% 20% 18% 16% 14% 12% 14% 18% 18% 19% 23% 25% - (20) (40) (60) (80) (100) (120) Q3FY06 Q4FY06 Q1FY07 (113) Q2FY07 (93) Q3FY07 (59) Q4FY07 (45) Q3FY06 Q4FY06 Q1FY07 Q2FY07 Q3FY07 Q4FY07 (140) (160) (129) (152) Consistent Financial Performance 27

28 Significant Investments for aggressive growth Capex (Rs.Cr.) Coverage of Population Centers FY05 FY06 FY ,300 1,200 No. of Sites 1,234 1, , FY05 FY06 FY FY05 FY06 FY07 28

29 Per Subs Trend Revenue & Costs Per Subs (Rs p.m) ,444 Positive EBITDA from Q1 FY06 Cash Profit from Q4 FY ,118 1, Q4 FY05 Q1 FY06 Q2 FY06 Q3 FY06 Q4 FY06 Q1 FY07 Q2 FY07 Q3 FY07 Q4 FY07 Revenue per sub Operational cost per sub Total cost per sub Operational cost per sub is comparable to Industry 29

31 Process Training & Certification ISO Documented Processes In-track Employees Process Audit Training Out-track Outsourced & Partners Certification Quarterly Cycle 31

32 The Rural-Urban Mix Urban Urban Strategy Strategy Branded Branded Shops Shops Organized Organized Retail Retail 200, ,000 Rural Subscribers 109, ,000 Rural Rural Reach Reach Strategy Strategy Branded Branded Van Van Bullock Bullock Cart Cart Youth Youth Focus Focus Corporate Corporate Focus Focus 100,000 50, Q3FY06 3,000 Q4FY06 15,000 Q1FY07 62,000 Q2FY07 Q3FY07 Q4FY07 Exploring Exploring untapped untapped villages villages Covering Covering Sales Sales of of Mobile, Mobile, FWPs FWPs and and RCVs RCVs 32

33 Innovate & Re-invent PTB in Autorikshaw Mobile PTB PTB in BEST Bus PCOs PCOsInstalled Installedat at BEST BESTBuses Buses Police PoliceChowkies Chowkies Airports Airports Railway RailwayStations Stations 33

34 Differentiator Bulls Eye Approach Value to Shareholders Employee Operational Efficiency Enterprise Rural Robust Growth 34

35 TTML Key Business Parameters Year on Year Growth (FY05 to FY07) EOP Subscriber Base (Mn) Revenue (Rs. Crs.) Year 1 Year 2 Year 3 0 Year 1 Year 2 Year 3 EBITDA (Rs.Crs.) Cash Profit (Rs. Crs.) Year 1 Year 2 (21) 0 Year 3 0 Year 1 (66) Year 2 Year 3 (210) 35

36 Operational Turnaround Highlights Market Market Share Share rd th rd th Position Position Accumulated Accumulated Losses Losses Low # Low # 1 1 in in Customer in Customer Care Care & Network Network Performance Performance PAT PAT (Negative) (Negative) Improved 74% Improved 74% Last Entrant into crowded market Revenue Revenue Over Over 807Cr 807Cr 1400Cr 1400Cr Cash Cash Profit Profit (Negative) (Negative) Positive 5 Seq. quarters Positive 5 Seq. quarters Cost Cost Per Per Sub Sub EBITDA EBITDA (Negative) (Negative) Positive 8 Seq. quarters Positive 8 Seq. quarters 36

37 in Summary Fastest Growing Subscriber base (89% CAGR) Most aggressive improvement In Operational Efficiency Increasing Market Share Increasing Operating Profits (EBITDA) Leveraging on People Training & Certification 167% 130% 242% 624% 133% 135% 37 Crossed the 3 million Subscriber Landmark Significant improvement in revenue EBITDA positive 8 quarters in a row EBITDA over Rs.300 Cr Significant improvement in Cash Profit Significant improvement in Cost efficiency Significant improvement in Productivity

38 Thank You 38