5. HFCL

While opinions are divided on the valuation of its scrip in the capital

market, the position of Himachal Futuristic Communications Ltd (HFCL) in the

Indian telecom market, is now established beyond dispute. With an estimated

total sales of Rs 1,163.25 crore in 2000-01, HFCL is today the No. 1 private

telecom company in India, taking both equipment and services companies into

account, and ranks No. 5 in the coveted Top 10 club of V&D 100 ranking. This

is a jump of three positions over last year’s position of No. 8.

The company registered a whopping 101 percent growth in sales, thanks to the

solid performance in both turnkey and equipment divisions. While the lion’s

share of 62.39 percent came from the turnkey division, the telecom equipment

contributed 35.79 percent. The rest came from the informatics division.

The large contribution of turnkey division shows that HFCL is finally rid of

its image of a DoT (now BSNL) supplier. All the turnkey contracts were received

by HFCL from private telecom service providers, utility companies going into the

telecom business and a few from defense and other public sector companies. Most

notable turnkey orders executed by HFCL last year were for Shyam Telelink in

Rajasthan, Reliance Infocom in Gujarat and Tamil Nadu, GAIL, Indian Railways and

Indian Air Force.

However, HFCL continued to do well in selling to DTS/BSNL. In 2000-01, the

segments where HFCL did particularly well were SDH, CorDECT Wireless Local Loop

(WLL) systems, DLC and microwave radios. It also won small orders for optimux.

Among the most significant orders bagged by HFCL were a 31.65 crore order from

DTS to supply STM 16 SDH equipment, a Rs 25 crore order from BSNL for supplying

CorDECT WLL equipment, a Rs 156 crore order from BSNL for rural CDMA WLL, and a

Rs 33 crore order from BSNL for DLC systems. HFCL also looked outwards. It

bagged an order worth Rs 27 crore from Nepal Telecom to supply microwave radio

and CorDECT WLL system; and a Rs 28 crore order from Iraq to supply microwave

radio and optical fiber cables.

While last year’s business was brisk, the order book for this year is

impressive. HFCL has a huge order of Rs 462 crore for CDMA WLL, a Rs 95 crore

order for SDH, a Rs 132 crore order for DLC, a Rs 25 crore order for CorDECT, a

Rs 48 crore order for 6/11 GHz microwave radios, all from BSNL, besides a lot of

small orders.

While HFCL did well in its core area of activity, telecom, as a group, the

new areas that it ventured into with Kerry Packer, did not fare as expected. For

instance, HFCL Nine Television, that started with a bang, is about to close a

major part of its TV operations.