Top 10: Turning Tables for TTML

Keeping in line with the brand premise of keeping things simple, TTML's revenue clocked `3,191 crore in FY11, up from `2,278 crore in FY10; showing tremendous growth of 40%.

After successfully winning the bid for 3G spectrum in the A Circle of Maharashtra with a bid value of `1,257.82 crore, the 3G spectrum win in Maharashtra (and Goa) region gives TTML access to the 3G spectrum for the next 20 years. This region of over 100 mn people with very high growth rate has immense potential for 3G services.

For FY11, TTML plans to invest almost `1,000 crore and `500 crore for FY12. TTML has crossed 10 mn subscribers in the rest of Maharashtra geography with subscriber growth rate of 29.4% in Maharashtra excluding Mumbai and 32.9% in Mumbai. Total subscribers for FY11 accounted for 16.9 mn.

The listed subsidiary of Tata Teleservices (TTSL) is betting heavily on data services and its newly-launched GSM platform, both of which continue to require substantial investments but the growth momentum continues to be strong. In fact with the company rapidly expanding its 3G network coverage in rest of Maharashtra circle, the revenue contribution from data+VAS segment will surge further.

Interestingly, TTML is the only network across Mumbai and Maharashtra to be rated congestion free in 7 consecutive reports published by Trai. Overall 'Quality of Service' with the 'Least Call Drop Rate' of 0.30% for Tata Indicom and 0.76% for Tata DOCOMO (against 0.87% for Reliance CDMA, 0.89% for Videocon, 1.19% for Bharti Airtel and 1.32% for Idea).

TTML has increased coverage of its Photon+ service to 10 cities in Maharashtra during 2010. The operator claims to have strong data and VAS entitiy and 3G services are adding on to it. It agrees that its non-voice revenue has further enhanced with 3G launches. VAS and data services are the key focus areas for TTML. Non-voice revenue increased from 18% in FY10 to 27% in FY11.

Towards the end of the year, TTML launched 3G services on its GSM Network and within a short span of 3 months, it has expanded 3G coverage to around 12 cities/towns in the state (excluding Mumbai). In its 3G package apart from vouching on services of mobile TV, video calling, live arti, etc, its 3G e-stick picked up lot of popularity and prominence in market. To reinforce its popular brand's positioning in the market, Tata Photon went under brand repositioning. TATA DOCOMO launched 2 new location based services-Route Finder and Smart Pilot. For both the services, Tata DOCOMO has tied up with NAVTEQ. TTML also announced the 2 innovative solutions-the Tata Photon+ Business Gateway and Tata Photon+ Home Gateway that would cater to the SME and home segments, respectively.

By December 2011, TTML's 3G service (which is marketed under Tata DoCoMo 3G) is expected to be rolled out in more than 75 cities and towns across the state. TTML's wireless data business could very well continue its near double-digit Q-o-Q growth momentum in the coming quarters.

In the wireline segment, TTML has strong presence and is planning to upgrade on capacity. TTML's connectivity of fiber is the strongest.

Last fiscal, even when the company failed to post any substantial growth in its total income and had the added burden of supporting and expanding 2 different networks ie, CDMA and GSM, TTML has done exceptionally well to control its costs. The sale of its tower subsidiary helped control the incremental debt due to the license fee payment.

With 3G, we can see some tables turning around in favor of TTML.