Dec

31

RCom Rolls Out GSM Service in 11000 Towns

Filed Under India Business, India Investment Opportunities, Indian Companies, Mobile Telecom, Tier-2 Cities | Leave a Comment

In one of the fastest network roll outs to cover one billion people, Reliance Communications (RCom) on has unveiled its nationwide GSM mobile service across 11,000 towns.

The rollout with an investment of Rs 10,000 crore, makes RCom the only national player to offer both CDMA and GSM services to customers.

  • RCom plans to execute both CDMA and GSM through an integrated operation.
  • RCom’s CDMA network spans more than 20,000 towns and 450,000 villages, with around 60 million subscribers.
  • The plan is to double RCom’s GSM coverage from 11,000 towns and three lakh villages to 24,000 towns and six lakh villages over the next few months, involving an incremental capex of a few thousand crore rupees.

Anil Ambani of Reliance ADAG and RCom said:

“In 2003, Reliance changed the landscape of telecom in India. Year 2009 will be no different. The company is targeting 100 million subscribers to use its network. We have done in 15 months what the industry has been trying to do in 15 years. Through the GSM launch, RCom plans to rewrite the rules of the industry in terms of pricing, proposition, value added services.”

  • RCom plans to procure seven million handsets for Rs 3,850 crore. For the first year of GSM operations, RCom has set a target to sell 15-20 million handsets.
  • RCom will use the existing 2,500 retail stores to push its new strategy.

Quick Facts On Indian Mobile Telecom Industry:

  • The Indian mobile handset market is expected to cross 100 million units this year against last years estimated size of 70-75 million units.
  • The GSM market serves 75% of the about 300 million mobile customers in India, and adds approximately nine million users every month.

Nov

28

Indian Real Estate - Time for bigger Investments & Change

Filed Under Emerging Sectors, India Business, India Investment Opportunities, India Real Estate, Indian Companies, Indian Government, Metros, Tier-2 Cities, Tier-3 Cities | Leave a Comment

The Times of India reports of a conference in Chennai hosted by Dun & Bradstreet about ‘Dynamics of the Real Estate Market: The Investment Perspective’. As per the conference, the Indian Real Estate Market is pegged at around $14 billion. Although the article presents a summary on the major discussions, 2 major points of discussion emerge.

1. Foreign Investment into Real Estate

This aspect has been well explained in previous posts on this website. The article on FDI in India puts Real Estate as one of the top 3 attractions for Investment.

And the article on Indian Commercial Real Estate also discusses the potential there is in Real Estate. But just to add an interesting fact here – Financial Institutions are among the biggest investors in Real Estate Projects in India.

Merrill Lynch is paying about $377m for a 49 per cent share in a portfolio of residential projects managed by DLF- Indian’s largest listed developer, in one of the biggest deals of its type in India. The transaction, Merrill Lynch’s sixth in Indian real estate, brings its investment in the sector to about $550m.

Late last year, JPMorgan announced its first investment on its own balance sheet in Indian property, paying $60m for a stake in a residential project being developed by Mumbai group, Lodha Builders.

2. Innovative products by Financial Institutions

The Times of India article quotes S. Sridhar, Chairperson and Managing Director, National Housing Bank:

“the real estate community needs to think out of the box and offer wide range of products, which suits the pockets of even people in the low-income group.”

Perhaps new financial products are needed various rate increases by the Reserve Bank of India (RBI) had serious impact for the retail loan segment.

Borrowers have declined in number and default has increased as the interest rates became unbearable and the burden of a rising EMI became too much for the average borrower. The resulting slump has made it difficult for the banks to match previous year’s record breaking credit growth.

Banks have tried to counter the retail loan growth decline by offering discounts on home loan and other retail loan interest rates and associated processing fees during this festival season. This led to a small increase in retail loan off-take, but the results didn’t match the expectations. Home loans have been worst hit - with the segment not taking off as expected, even after festival-season discounts.

About the Author: Ishan Sethi is a Sales & Marketing professional with keen interest in emerging sectors and India business opportunities. He is an alumnus of Indraprastha University and IIM Lucknow. He can be reached via the Contact page.

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