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The Top Shots

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VoicenData Bureau
New Update

The annual Indian communication

industry performance survey, V&D 100 1999 reveals that the total communications market

size for the fiscal 1998-99 was at Rs 25,365.22 crore. The Top 100 companies or the

V&D 100 Club contributed Rs 23,262.32 crore. Apart from this, the 390 other companies

that we covered contributed Rs 1,602.90 crore. Plus the companies which we missed or could

not get any information about, together must have pooled in roughly Rs 500 crore to the

industry kitty, thereby taking the total market size to Rs 25,365.22 crore.

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Modus Operandi
The entire exercise of

V&D100 started in April of this year, with the sending of questionnaires to about

1,000 probable communications companies which deal in communications in some way or the

other — in terms of products or services. Only 260 companies filled up the

questionnaire and sent the it back to us, which speaks of the openness and transparency

most of these companies keep harping about. However, we were able to get company

information from informal and other sources for another 230 companies. So, altogether a

total of 490 companies have been covered in the V&D 100 survey. Though ideally, a lot

of factors such as profitability, market capitalisation rate, corporate image,

geographical reach, customer satisfaction levels, innovativeness etc were intended to be

included to ranking parameters, the kind of response and co-operation we got did not allow

us. Finally, the rankings were done only on the basis of revenues from communications

products and services.

In some cases the companies

sent us their total revenues with or without break-up of communications revenues. In such

cases we have done our own estimation of the company’s communication figures. One

change that has been from this year in terms of defining our horizon for communications

services is that we have dropped systems integration from it. Hence, revenues accruing

only from network integration has been considered for this years ranking. A total of 3,840

manhours and countless cups of tea and coffee at Voice & Data has gone into the making

of this Annual Issue, considered to be the Bible of Indian communications Industry.

"The Top 10 Club"

companies notched up 67.95 percent of the total revenue as their combined turnover was

estimated to be Rs 17237.88 crore. This indicates that communications industry is still

dominated by large players. But considering the fact there are too many market segments

here and the number of players comparatively low, it is expected that this dominance of

the Top 10 companies over the industry will go down and more local and niche area players

will emerge.

The V&D 100 Club

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The Top 10

alt="https://img-cdn.thepublive.com/filters:format(webp)/vnd/media/post_attachments/50b438ae55540744edf55a2b5ef952a766e683cb83587211713a04b430a6ab78.gif (12567 bytes)" align="left" hspace="4" vspace="4"> face="Times New Roman" size="2">There has been no change in the positions of the Top 6

companies. VSNL still retains the # 1 position with a turnover of Rs 7,189.60 crore, an

increase of 12.41 percent from last years turnover of Rs 6,395.80 crore. MTNL is firmly

sitted on the # 2 position with a turnover of Rs 5,443.89 as the next competitor ITI still

has a long way to go as it has a modest turnover of Rs 1,600.00 crore. TCIL is placed at #

4 position and Sterlite is placed at # 5 with a turnover of Rs 562 crore. The Top 6

companies have not only retained their positions, but have also shown a growth of more

than 12 percent with only exception being Sterlite which has grown by only 2.18 percent.

Global Telesystems has



maintained its # 7 position even with a growth of 13.55 percent. HFCL is a surprise
entrant in the Top 10 as the company with an impressive growth of 115.69 percent.

HTL Ltd has retained its # 8 position and has grown by 28.57 percent. A marginal increase

of 6.93 percent has pushed Wipro Infotech at the # 9 position and at the bottom of the

table is Usha Beltron, with a turnover of Rs 243.90 crore.

The V&D100 Club has 106

companies under its fold , as there were a few tie-ups for some ranks. GEIL Projects &

Services Ltd and Enkay Telecom were tied up at the 40th rank, with a turnover of Rs 70

crore; Punwire Mobile Communications Ltd and Skycell Communications Ltd were tied up at

the 79th place with a turnover of Rs 26.00 crore; Microwave Communications and Telstra

V-Comm were placed at 87th position with a turnover of Rs 24 crore; and Meera Agencies Pvt

Ltd, Syntel Telecom, and Tata Infotech Ltd were all tied up at 97th position with a

turnover of Rs 20.00 crore. One hopes that in the years to come as shakeout and

consolidations take place on the one hand and more players come up on the other, there

will be stiffer competition between the players and each competitor will have to fight

harder to have a position in V&D100 Club.

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V&D 100–The

Top 10 Club (1998-99)
Company Turnover (Rs Crore)

(1998-99)
98-99 Rank Turnover (Rs Crore)

(1997-98)
97-98 Rank Growth (in percent)
VSNL 7189.60 1 6,395.80 1 12.41
MTNL 5443.89 2 4,645.54 2 17.18
ITI 1600.00 3 1,270.00 3 25.98
TCIL 639.00 4 560.00 4 14.10
Sterlite 562.00 5 550.00 5 2.18
Global Tele-Systems 539.50 6 475.11 6 13.55
HFCL 392.11 7 181.79 115.69
HTL Ltd 360.00 8 280.00 8 28.57
Wipro Infotech 267.88 9 250.50 10 6.93
Usha Beltron 243.90 10 230.00 6.04

As many as 30 companies in the

V&D 100 Club are JVs primarily between MNCs and Indian companies. Plus there are 22

MNCs. This clearly displays a good hold that MNCs have on the Indian communications market

space as well as the fact that they have a high level of interest in India. These JVs have

the financial muscle or the technical expertise to support the Indian partners as they are

in the process of consolidating their brands in the Indian market. The presence of 11

public sector companies says that they are there by virtue of being an old and established

company but it also means that these public sector units are gearing up to face the

growing threat from the private sector. While in some cases they are likely to succeed, in

some case they will not. In the future we are likely to see more PSUs exiting from the

V&D100 Club, if they do not perform well.

The most interesting observation

was in terms of the type of activities of the players. Out of the 100 companies, 44 belong

to the services and 56 to the equipment category. This means that the service industry

still has a long way to go, as they are logically expected to overtake the vendors dealing

in products only. This is specially true of a new market like India where a lot of

investments are going into developing infrastructure backbone. Infrastructure companies

have started making their mark as 15 companies feature in the V&D 100 Club. Also,

non-telecom players like the Power Grid, GAIL, and the Railways, which though have not

been covered in the V&D 100 survey, are enhancing their networks as opening of long

distance telephony has given them enough width to leverage on in the future. The

infrastructure equipment industry grew by 24 percent. In future one can see a huge

investment by the utilities companies in the area of communications and such companies

becoming dominant players.

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The V&D 100 Club has 18

companies from the cellular sector. These companies have not done well but the sheer

number of subscribers help them in pushing their revenue base. As

Segment-wise Break-up
Segments Numbers Total Revenue Percent Average
Cellular 18 1367.29 5.88 75.96
Infrastructure 15 4048.37 17.41 269.89
Networking/Structured Cabling 15 745.47 3.20 49.70
Telecom Cables 12 1807.68 7.78 150.64
Integration 9 536.95 2.30 59.66
VSAT 8 297.08 1.28 37.13
Multi Product 7 775.5 3.34 110.78
Paging 6 183.29 0.78 30.54
T&M 4 126.54 0.54 31.63
Businesscom 3 265.45 1.14 88.48
Personal Communication 3 155.65 0.68 51.88
Telecom Software 2 260.08 1.12 130.04
Multiple Services 2 12633.49 54.30 6316.74
Others 2 59.48 0.25 29.74
Total 106 23262.32 100.00 219.45

other services have not been

doing well, the cellular service providers had a definite advantage over others and state

wide circle operators was encashing on that as 1998-99 was the year for circle operators

and not metros.

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Around 15 networking/structured

cabling companies feature in the V&D 100 Club. This was primarily due to the fact that

the networking industry grew by 92 percent in the fiscal 1998-99 and registered an

all-time high of Rs 537 crore. In future we might see an increase in the number of

companies dealing in such products as everybody will try to jump into the networking

bandwagon. This will result in drop in prices and shakeouts. Only those companies will

survive which will provide more value to its customers.

Integration accounted for Rs

536.95 crore whereas VSATs accounted for Rs 297.08 crore. In terms of numbers, the

installed capacity of VSATs in the country increased from 6,000 to 8,490 registering a

growth of 41.5 percent. This is another pointer to the fact that users are looking for

complete solutions. As more and more corporate houses go in for networking, the market for

network integration will increase in size and one can see a multiple of big players

emerging to cater to it.

Even though paging contributed

only around Rs 183.29 crore in the V&D 100 Club, six companies were able to make their

positions in the Club. If the paging services had done well, the V&D 100 Club would

have accomodated more players. The same story goes for the cellular too. The interesting

fact for both paging and cellular is that they are not doing well in the areas where they

were tried first, but are doing well in the new areas that they have been introduced.

Surely, there is a market for this service, its only a matter of conducive environment and

right strategies, before we see some more paging and cellular companies entering the

V&D 100 Club.

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Four T&M companies figured in

the V&D 100 Club in spite of the non-buying of the private operators. The DoT

purchases and large scale buying from GAIL, Power Grid, and the

Railways compensated the

industry.

With three basic service

operators having already started the services in MP, Maharashtra, and Andhra Pradesh,

chances are that these operators and many that will start the service in the coming fiscal

have a fair chance to make to the V&D 100 Club. Radio Trunking and Internet companies

still have a long way to go as they are still busy in collecting the requisite number of

subscribers to make a mark in the market.

   face="Arial" size="1">Data Collection in Delhi by



Prastut Consulting Pvt Ltd

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