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MIRA
INFORM REPORT
|
Report Date : |
13.01.2011 |
IDENTIFICATION DETAILS
|
Name : |
TATA TELESERVICES ( |
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Formerly Known As : |
HUGHES TELECOM ( |
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Registered Office : |
Voltas Premises, T. B. Kadam Marg, Chinchpokli, Mumbai –
400033, |
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Country : |
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Financials (as on) : |
31.03.2010 |
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Date of Incorporation : |
13.03.1995 |
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Com. Reg. No.: |
11-86354 |
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CIN No.: [Company
Identification No.] |
L64200MH1995PLC086354 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMH00331C |
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PAN No.: [Permanent
Account No.] |
AAACH1458C |
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Legal Form : |
A Public Limited Liability Company. Company’s Shares are Listed on the Stock Exchanges. |
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Line of Business : |
Telecommunications Service Provider. |
RATING & COMMENTS
|
MIRA’s Rating : |
B (27) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Maximum Credit Limit : |
-- |
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Status : |
Moderate |
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Payment Behaviour : |
Slow |
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Litigation : |
Clear |
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Comments : |
Subject is a part of TATA Group and is an established company having
moderate track. There appears huge accumulated losses recorded by the
company. However, trade relations are reported as fair. Business is active.
Payments are reported to be slow. The company can be considered for business dealings with some caution.
|
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – April 1, 2010
|
Country Name |
Previous Rating (31.12.2009) |
Current Rating (01.04.2010) |
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|
A1 |
A1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
INFORMATION PARTED BY
Note : Management non co- operative [ Name not Disclosed]
LOCATIONS
|
Registered Office : |
Voltas Premises, T. B. Kadam Marg, Chinchpokli, Mumbai –
400033, |
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Tel. No.: |
91-22-66615445/ 66615152 |
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Fax No.: |
91-22-66671049/ 66605516/ 5517 |
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E-Mail : |
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Website : |
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Administrative Office
: |
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Corporate Office/ Branch : |
D-26, TTC Industrial Area, MIDC, Sanpada, P. O. Turbhe,
Navi Mumbai – 400 613, |
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Tel. No.: |
91-22-66615445 |
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Fax No.: |
91-22-66605516/ 5517 |
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E-Mail : |
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Branches : |
Al |
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Fax No.: |
91-20-66096300 |
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E-Mail : |
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Branches : |
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Tel. No.: |
91-832-6647777 |
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E-Mail : |
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Branches : |
Plot No. 37-A,
M.I.D.C., Ambad, |
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Tel. No.: |
91-253-6607777 |
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E-Mail : |
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Branches : |
Vasant Rutu Plaza, "E" Ward, C. S. No. 460, (Daewoo Showroom Building),Venus Corner, New Shahupuri, Kolhapur - 416003, Maharashtra, India |
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Tel. No.: |
91-231-6687777 |
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E-Mail : |
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Branches : |
Survey No. 3 (Part),
Plot No. Commercial Club Plot, |
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Tel. No.: |
91-240-6627777 |
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E-Mail : |
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Branches : |
Renavikar Mangal Karyalaya Building, Savedi Cell Site, Savedi Road, Ahmednagar - 414003, Maharashtra, India |
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Tel. No.: |
91-241-6607777 |
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Branch Office : |
Ground Floor, Ranjit Empire, |
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Tel. No.: |
91-233-6607777 |
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Branch Office : |
Ispat House, B. G. Kher Marg, Worli, Mumbai - 400 018, |
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Tel. No.: |
91-22-56615445 |
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Branch Office : |
1st Floor, |
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Branch Office : |
c/o Premco Industries, Premco House, A-26, Street No. 3, MIDC
Marol,Andheri (East), Mumbai - 400050, |
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Branch Office : |
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DIRECTORS
As on :09.08.2010
|
Name : |
Mr. Mukund Rajan |
|
Designation : |
Managing Director |
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Date of Birth : |
05.04.1968 |
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Qualification |
B. Tech from IIT, |
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Experiences : |
Rich experience in Telecom and Business |
|
Date of Appointment : |
23.01.2008 |
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Other Directorship : |
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Name : |
Mr. Ashok Jhunjhunwala |
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Designation : |
Director |
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Name : |
Mr. N. S. Ramachandran |
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Designation : |
Director |
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Name : |
Mr. Nadir Godrej |
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Designation : |
Additional Director |
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Date of Birth : |
26.08.1951 |
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Qualification |
B. S. (Chemical Engineering) from the Massachusetts Institute of |
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Experiences : |
Rich experience in various Industries |
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Date of Appointment : |
12.03.2008 |
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Other Directorship : |
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Name : |
Mr. S Ramadoral |
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Designation : |
Director |
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Date of Birth : |
06.10.1944 |
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Qualification |
Bachelor’s degree in Physics from |
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Experiences : |
Rich experience in Information Technology and Business |
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Date of Appointment : |
10.08.2006 |
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Other Directorship : |
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Name : |
Mr. Anil Sardana |
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Designation : |
Additional Director |
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Date of Birth : |
16.04.1959 |
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Qualification |
Electrical Engineering from |
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Experiences : |
Rich experience in Business, Turnaround and change management |
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Date of Appointment : |
12.03.2008 |
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Other Directorship : |
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Name : |
Mr. Amal Ganguly |
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Designation : |
Independent Director |
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Name : |
Mr. Kishor A Chaukar |
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Designation : |
Chairman and Non Executive Director |
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Name : |
Mr. D. T. Joseph |
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Designation : |
Independent Director |
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Name : |
Mr. Koichi Takshara |
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Designation : |
Non Executive Director |
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KEY EXECUTIVES
|
Name : |
Mr.
Madhav J. Joshi |
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Designation : |
Chief
Legal Officer and Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 01.10.2010
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
Indian |
|
|
|
Bodies corporate |
1244664393 |
65.61 |
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|
|
|
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Sub total |
1244664393 |
65.61 |
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|
|
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Foreign |
|
|
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Bodies corporate |
229856926 |
12.12 |
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|
|
|
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Sub total |
229856926 |
12.12 |
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|
|
|
|
Total shareholding of Promoter and Promoter Group (A) |
1474521319 |
77.72 |
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|
|
|
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Public
Shareholding |
|
|
|
Institutions |
|
|
|
Mutual Funds / Axis |
4590000 |
0.24 |
|
Financial Institutions / Banks |
6077790 |
0.32 |
|
Central Government / State government |
37000 |
-- |
|
Insurance companies |
825000 |
0.04 |
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Foreign Institutional Investors |
26639249 |
1.40 |
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Any others |
9189 |
-- |
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Overseas Corporate Bodies |
9189 |
-- |
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Sub Total |
38178228 |
2.01 |
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Non Institutions
|
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Bodies Corporate |
42833382 |
2.26 |
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Individuals |
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Individual Shareholders holding nominal share capital upto Rs.0.100
millions |
272085628 |
14.34 |
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Individual shareholder holding nominal share capital excess of
Rs.0.100 million |
60508861 |
3.19 |
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Any Other (Specify) |
3084 |
0.48 |
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Trusts |
72221 |
-- |
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|
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Non Resident Indians |
8992515 |
0.47 |
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Directors and their Relatives and Friends |
4700 |
-- |
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|
|
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Sub Total |
384497307 |
20.27 |
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|
|
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Total Public Shareholding (B) |
422675535 |
22.28 |
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|
|
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Total (A)+(B) |
1897196854 |
100.00 |
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Total
|
1897196854 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Telecommunications Service Provider. |
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Products : |
Item Code No. |
Product Description
|
|
Not
Applicable |
Telecommunications Service |
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GENERAL INFORMATION
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No. of Employees : |
About 2500 |
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Bankers : |
· Citibank NA, ·
Industrial Development Bank of · Axis Bank Limited |
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Facilities : |
NOTES: 1. Stipulated securities for the loans are either one or more of the following as per terms of the arrangements with respective banks: - by first pari pasu charge on the assets of the company - by pledge of shares of TTSL shareholding in the Company. - by assignment of the proceeds on sale of network in the event of cancellation of the telecom license - by assignment of telecom license - by assignment of insurance policies - by sponsor support undertaking of Tata Sons. 2. the existing charges are being released/modified and
creation of new charges is in progress.
NOTES: During the year ended March 31, 2005, the company issued FCCB of USD 125 millions at an interest rate of 1% per annum (payable semi-annually). The holders of these bonds had on option to convert the Bonds into equity shares of the company on or after July 1, 2004 at a pre determined price of Rs, 24.96 per Equity Shares. Subsequent to the right issue of Equity Shares. The bonds that are not converted into Equity Shares, are redeemable at a premium of 19.38 % at the end of 5 Years from the date of issue. Accordingly, the outstanding bonds as at the date of redemption have been redeemed (along with redemption premium ) during the year. |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
Deloitte Haskins and Sells Chartered Accountants |
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Address : |
12, |
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Holding Company : |
Tata Sons Limited |
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Subsidiary Companies |
21st Century Infra Tele Limited |
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Fellow Subsidiaries : |
-
Computational Research Laboratories Limited -
Eqart Investments Limited -
Infiniti Retail Limited -
Tata AIG General Insurance Company Limited -
Tata AIG Life Insurance Company Limited -
Tata Investment Corporation Limited -
Tata Petrodyne Limited -
Tata Trustee Company Limited -
E-NXT Financials Limited -
Tata Advance Systems Limited (w.e.f. 26.09.2008) -
Tata Assets Management Limited -
Tata Business Support Services Limited -
Tata Capital Limited -
TC Travel and Services Limited (w.e.f. 15.10.2008) -
Tata Securities Limited -
Tata Housing Development Company Limited -
Tats Sky Limited -
Tata Teleservices Limited -
Tata Internet Services Limited -
Wireless – TT Info Services Limited -
Tata Consulting Engineering Limited -
Tata Realty and Infrastructure Limited -
Tata Consultancy Services Limited -
CMC Limited -
TCS e- Serve Limited |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
2500000000 |
Equity Shares |
Rs.10/- each |
Rs.25000.000 Millions |
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Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1897196854 |
Equity Shares |
Rs.10/- each |
Rs.18972.000 Millions |
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|
NOTES:
1. Of the above 1,107,401,219 Equity Shares are held by Tata Sons Limited (the ultimate Holding Company) and its Subsidiaries.
2. Of the above nil (Previous Year 3,626,786) Equity Shares are issued during the year on conversion of Foreign Currency Convertible Bonds.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
18972.000 |
18971.900 |
18935.600 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
5831.600 |
5831.600 |
5761.700 |
|
|
4] (Accumulated Losses) |
(31466.900) |
(28486.800) |
(26703.200) |
|
|
NETWORTH |
(6663.300) |
(3683.300) |
(2005.900) |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
23004.300 |
20361.300 |
20980.900 |
|
|
2] Unsecured Loans |
13090.000 |
10761.600 |
5287.800 |
|
|
TOTAL BORROWING |
36094.300 |
31122.900 |
26268.700 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
29431.000 |
27439.600 |
24262.800 |
|
|
|
|
|
|
|
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APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
35038.200 |
28990.800 |
28611.300 |
|
|
Capital work-in-progress |
1969.100 |
2180.700 |
1250.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
1200.000 |
750.000 |
0.000 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
64.000 |
20.100 |
22.200 |
|
|
Sundry Debtors |
2641.200 |
2407.300 |
2014.800 |
|
|
Cash & Bank Balances |
229.800 |
274.800 |
344.600 |
|
|
Other Current Assets |
0.000
|
0.000
|
0.000
|
|
|
Loans & Advances |
3010.500 |
2999.100 |
2169.900 |
|
Total
Current Assets |
5945.500 |
5701.300 |
4551.500 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
1293.800 |
1338.800 |
9819.100 |
|
|
Sundry Creditors |
13366.700 |
8477.300 |
NA |
|
|
Provisions |
61.300 |
367.100 |
330.900 |
|
Total
Current Liabilities |
14721.800 |
10183.300 |
10150.000 |
|
|
Net Current Assets |
(8776.300) |
(4481.900) |
(5598.500) |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
29431.000 |
27439.600 |
24262.800 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
|
SALES |
|
|
|
|
|
|
|
Telecommunication Services |
20691.000 |
19416.800 |
17071.900 |
|
|
|
Other Income |
2087.100 |
1122.800 |
824.100 |
|
|
|
TOTAL (A) |
22778.100 |
20539.600 |
17896.000 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Operation and other Expenses |
17373.000 |
14607.800 |
13040.500 |
|
|
|
Other Expenses |
0.000 |
0.000 |
0.000 |
|
|
|
TOTAL (B) |
17373.000 |
14607.800 |
13040.500 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
5405.100 |
5931.800 |
4855.500 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
3176.200 |
3047.800 |
1710.100 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
2228.900 |
2884.000 |
3145.400 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
5208.900 |
4467.900 |
4393.500 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
(2980.000) |
(1583.900) |
(1248.100) |
|
|
|
|
|
|
|
|
|
Less |
TAX (I) |
0.100 |
12.100 |
9.300 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-I) (J) |
(2980.100) |
(1596.000) |
(1257.400) |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
(28486.800) |
(26703.200) |
NA |
|
|
|
|
|
|
|
|
|
|
BALANCE CARRIED
TO THE B/S |
(31466.900) |
(28486.800) |
NA |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Capital Goods |
5775.100 |
3643.900 |
1978.800 |
|
|
TOTAL IMPORTS |
5775.100 |
3643.900 |
1978.800 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
(1.57) |
(0.84) |
(0.68) |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
30.06.2010 |
30.09.2010 |
|
Type |
|
1st
Quarter |
2nd
Quarter |
|
Sales Turnover |
|
5762.900 |
5600.900 |
|
Total Expenditure |
|
4640.500 |
6101.500 |
|
PBIDT |
|
1122.400 |
(500.600) |
|
Other Income |
|
59.300 |
8380.500 |
|
Operating
Profit |
|
1181.700 |
7879.900 |
|
Interest |
|
746.900 |
897.800 |
|
Exceptional
Items |
|
0.000 |
0.000 |
|
PBDT |
|
434.800 |
6982.100 |
|
Depreciation |
|
1413.800 |
1403.300 |
|
Profit Before
Tax |
|
(979.000) |
5578.800 |
|
Tax |
|
0.000 |
0.000 |
|
Reported PAT |
|
(979.000) |
5578.800 |
|
Extraordinary Items |
|
0.000 |
0.000 |
|
Prior Period Expenses |
|
0.000 |
0.000 |
|
Other Adjustments |
|
0.000 |
0.000 |
|
Net Profit |
|
(979.000) |
5578.800 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
PAT / Total Income |
(%) |
(13.08) |
(7.77) |
(7.03)
|
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
(14.40) |
(8.15) |
(7.31)
|
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
(7.27) |
(8.15) |
(3.76)
|
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
(0.44) |
(0.43) |
0.62
|
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
(7.62) |
(11.21) |
(18.16)
|
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
0.40 |
0.55 |
0.45
|
LOCAL AGENCY FURTHER INFORMATION
SUNDRY CREDITORS
DETAILS :
|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
Total Outstanding dues of Micro Enterprises and Small Enterprises |
|
|
|
|
Total Outstanding dues of Creditors other than Micro Enterprises and Small Enterprises |
-- |
-- |
|
|
- Under Usance Letter of Credit |
5262.600 |
1363.300 |
NA |
|
-Others |
8104.100 |
7114.000 |
NA |
|
|
|
|
|
|
TOTAL |
13366.700 |
8477.300 |
NA |
HISTORY:
Subject was incorporated in the year of 1995. TTML (Formerly
Hughes Telecom (India) Limited) is a ISO 9001:2000 company engaged in telecommunication
service and licensed to provide services in Maharashtra (including Mumbai) and
Goa. It offering the services consist of Basic Services, Cellular Services and
Internet Telephony with Web Conferencing Services, it covers both wireless and
wireline services. Subject emerged as the market leader in Fixed Wireless
Phones (FWP) services in
During the year 2004-05, the Company repositioned its new
two sub-brands namely The 'Walky' and "Walky Prepaid". The Walky
covers fixed wireless services with enhanced features like high speed Internet
without modem, SMS, CLI facility and voice mail. The 'Walky' sub-brand has
instantly become the most popular brand in its product segment and has helped
the Company to garner about 70% share of the growth in the fixed wireless
segment. The Walky Prepaid deals with Prepaid tariff plans. In September 2004, the
Company embarked its another one entry into the Prepaid segment by launching
Tata Indicom True Paid which offered 100% talk time (without rental). Subject
concentrates not only in cities, also in rural areas, company introduced weekly
prepaid and also launched Indicom 10(numbering Fixed wireless service) in rural
In the year 2007
company in collaboration with Samsung, has introduced the first dual SIM card
wireless phone in
As on March 2008 Tata Teleservices Maharashtra had crossed
the 5 million subscribers which is milestone for the company.
Financials :
The total revenue grew by 10.90% to Rs. 22778.100 millions. During the year, the Company consolidated its position in the market by increasing its share of new additions in the wireless market (i.e. fixed wireless and mobile). The subscriber base grew by 73% to cross 13 million, mainly through the very successful launch of GSM services by the Company. The change in interconnect regime with reduced termination charges and competitive pressures which pulled down the tariffs resulted in lower Average Revenue per User (ARPU) compared to the previous year. Operating expenses increased by 18.93%, mainly due to costs associated with the launch and operations of GSM services. The Company has acquired more than 4 million GSM subscribers who are serviced through 4,000 plus Base Transceiver Station (BTSs) across Mumbai & Maharashtra. The Company reported a positive EBIDTA of Rs. 5405.100 millions, as compared to the previous years EBIDTA of Rs. 5931.800 millions despite the costs associated with the launch of GSM services.
Products
and Services :
The
Company holds two Unified Access (basic + cellular) Service Licenses (UASL),
one for Mumbai Metro and the other for Maharashtra circle i.e. Rest of Maharashtra and
During the year, the Company focused on increasing its retail presence to achieve a better market penetration for its various products and services. The extremely successful launch of GSM services under TATA Docomo brand has given a significant boost to subscriber additions. The Company’s total subscriber base as on March 31,2010 stood at 13 million, an increase of 73.5% over the previous year. The Company’s wireless subscriber base in Rest of Maharashtra circle crossed 7.8 million, and the Company is now the 2nd largest telecom operator in this geography. The Company’s wireless subscriber base in Mumbai circle crossed 4.4 million subscribers and the Company is now the 3rd largest telecom operator in this geography. During the year, the Company registered highest incremental wireless subscriber additions of 28% and end of period market share of 17.6%.
Total number of BTSs as on March 31, 2010 were 7,645, an increase of 185% over previous year primarily on account of roll out of more than 4,000 BTSs for GSM services.
CDMA & Wireline Services
During
the year, the Company increased its focus on CDMAs inherent data capabilities
to offer high speed data services to subscribers. The Company offers High Speed
Internet Access (HSIA) service under the Tata Photon* brand across Mumbai and
major towns in Maharashtra and
The Company has laid over 1,662 kms of buried fiber across Mumbai and already connects over 20,000 buildings with broadband services. To expand the network further at optimal cost, the Company has entered into co-build agreement with other operators. The Company would continue to make investments to strengthen its Digital Mumbai offerings and would increase voice and data penetration in already wired buildings, besides enhancing the customer value proposition with initiatives like combo offers of voice and broadband, partnerships with content providers, and brand promotion through a Digital Mumbai portal.
The Company is a Category A (National) ISP Licensee and offers a broad range of Internet-related services including Digital Subscriber Lines (DSL), leased lines and dial-up internet access. The Company, along with Tata Teleservices Limited (TTSL), has a national footprint for its popular Tata Indicom conference call service, with 15 Points of Presence across the country for providing local access to conference bridges.
The Company continued to focus on value added service offerings. The Company introduced several attractive product and service propositions that addressed specific customer needs, including:
- Photon+ wireless broadband service, offering speeds upto 3.1 Mbps, 20 times faster than other wireless technology, in prepaid.
- Photon TV an application which enables the consumer to watch live TV through Photon* data connection.
- Innovative Value Added Services such as welcome tunes, English Seekho and Live chatting.
- The Company also entered into partnership with Microsoft X-Box, offering combo plans of its Power Launcher product which offers ultra high speed broadband with the Microsoft X-box Gaming Console.
Recognition of Customer Service and Network
quality
The Company has been rated as the No. 1 wireless telecom service provider in terms of overall customer satisfaction across the Mumbai and Maharashtra Circles in independent studies commissioned by Telecom Regulatory Authority of India (TRAI).The Company’s network has also been rated as the only congestion free network in six consecutive quarterly reports published by TRAI.
GSM Services
The
Company launched its GSM services in Mumbai and across
Tata
Docomo offers innovative tariff options and introduced the Pay-per-use
advantage. The Pay-per-use model represents a paradigm shift in the overall
telecom experience. It allows the consumer to pay only for the seconds
utilized, heralding another revolution in the mobile telecommunications
industry in
Tata
Docomo offers Lifetime @ 1 paise/second for all calls across
Daily Plans proposition provides flexibility and caters to the diverse needs of subscribers and gives them the power to select a different plan everyday that best suits their need for the day.
A variety of postpaid plans designed for a range of consumer requirements are also available on this revolutionary per- second billing model.
Network Rollout
During
the year, the Company successfully launched GSM wireless services under Tata
Docomo brand in 859 new towns in Maharashtra and
The
Company also rolled out CDMA wireless services in 33 new towns in Maharashtra
and
During the year, the Company has focused on operational efficiency and quality control measures with a constant endeavor to further improve its network quality. The Company has also successfully unlocked the bandwidth potential in its existing transmission network and offered transmission bandwidth to the new operators.
3G Spectrum
The
bidding for 3G spectrum concluded on May 19,2010.The Company has succeeded in
winning the bid for 3G spectrum in Rest of Maharashtra (including Goa) Circle
and has paid Rs. 1,2578.200 millions. This win gives the Company access to the
3G spectrum for the next 20 years across a region of over 100 million people.
TTSL has won 3G spectrum primarily in the in western belt of
Quality and Processes
The Company has undertaken ISO 9001:2008 certification to demonstrate its capability to consistently provide services that enhance customer satisfaction through effective deployment of a quality management system. The Company was the first basic telecommunication provider together coveted ISO 9001:2000 certification inAugust2002.lntherecenttransition audit from ISO 9001:2000 to ISO 9001:2008 conducted by TUV India in January 2010, the Company was awarded a Certificate of Transition and Continuation for ISO 9001:2008 with Nil Non-Conformance.
The Company is also taking active part in the Tata Business Excellence Model (TBEM) process, with knowledge sharing and appropriate support being extended by Tata Quality Management Services (TOMS), a division of Tata Sons Limited.
The
model enables the leadership to set direction of the organization based on its
Vision,
Human Resources
The Company assigns the highest degree of importance to its human resources which are very critical for a service organization like their . The Human Resources (HR) function of the Company constantly strives to achieve the mission of the Company by creating a favorable work environment and by institutionalizing a performance oriented work culture. The financial year 2009-10 has been a very successful year for the HR function, meeting the challenges effectively including the following:
One of the major challenges for the Company was to create a sustainable organization for GSM services at a point in time where multiple service providers were inundating the job market with excessive offers. The Tata Docomo organization was created in a record time of less than six months, for which best in class talent was recruited across levels and businesses and was provided an empowered platform to perform to the best of its abilities. This has definitely yielded exemplary results as visible from the stupendous kick start to the GSM business.
Performance Culture:
My PMS was redesigned to enhance objectivity of assessment in line with business expectations. Employee Career Development Process was also integrated with my PMS process to capture employee career aspirations. My PMS is also aligned with Tata Leadership Practices for potential assessment.
HR-Excellence & Employee Engagement:
The year saw many initiatives in HR in the area of workforce management leading to remarkable achievement in the TBEM scores in employees and HR results categories.
The employees are actively engaged in various programs through Cross Function Teams such as DHOOM, Team Josh, PRAYAS etc. The Company also conducted Gallup Employee Engagement Survey for getting candid and honest feedback from employees. 97% of the employees participated in the survey and the overall grand mean score for the Company was 4.24 (out of 5) with engaged to dis-engaged employees ratio of 10:1, which is far above the world class benchmark, 5.3:1 The attrition rate also reduced significantly to 13.08% from 16.64% in the previous year.
Another major step forward was Information Technology (IT) enablement of a majority of HR processes. With implementation of several IT solutions for routine HR services, there is a reduced dependency of employees for transactional H R and this has further enabled H R team to invest quality time in employee related assignments.
Regulatory
Developments and Important Litigation
a) There have been many regulatory changes, prominent amongst which are:
i. The DoT has announced that Mobile Number
Portability (MNP) will be implemented across
ii. Long awaited auction of 3G spectrum started on April 9, 2010 and closed on May 19, 2010 after 183 rounds of bidding. The DoT received upfront payment aggregating Rs.677190.000 millions from the bidders and BSNL and MTNL who were already pre-allocated spectrum without participation in the bidding process. None of the bidders has got spectrum in more than 13 (out of 22) circles and hence roaming alliances with other winning operators and BSNL and MTNL will be crucial. The 3G spectrum auction was followed by auction of spectrum for wireless broadband services in which the Company or TTSL did not participate.
iii. TRAI had submitted on May 11, 2010, its much awaited recommendations on Spectrum Management and Licensing framework wherein it has made recommendations to DoT on allocation and pricing of 2G spectrum, new licenses, license fee and mergers and acquisition. TRAI is expected to submit by July 15, 2010, its further recommendations on determination based on 3G results of Current Price for allocation of spectrum in 1,800 M Hz band. DoT may take decision on the recommendations after receiving these further recommendations.
b) The Company has also been a party to some important litigations like those pertaining to Fixed Wireless Access Deficit Charges (ADC) demands of BSNL of 2004-05, DoTs attempt to lodge a counter-claim on the Company for not signing in 1997 the license agreement for basic services in the Karnataka circle, penalty imposed by the DoT for the launch of innovative Push-to-Talk services, industry litigation on exclusion of revenues unrelated to licensed activities for determining license fee liability and method of calculation of microwave charges payable to DoT.
Information on the regulatory developments and important litigation has been provided in the report on Management Discussion & Analysis of Financial Condition and Results of Operations which forms part of this Annual Report.
Subsidiary
The Company had a Wholly Owned Subsidiary i.e. 21 st Century Infra Tele Limited (CITL) as on March 31, 2010. During the financial year ended March 31,2010, CITL recorded revenues of Rs. 1020.000 millions, Cash Profit of Rs. 330.000 millions and net loss of Rs.100.000 millions.
The Company has agreed to sell its 100% stake in CITL to Wireless - TT Info Services Limited (WTTIL), the passive infrastructure subsidiary of TTSL, for net consideration of approximately Rs. 9450.000 millions and has entered into a Share Purchase Agreement. The transaction was subjected to certain conditions precedents which were not completed as on March 31,2010.The conditions precedents have subsequently been met in May 2010 and the Company has transferred the shares and has received first installment of the Rs. 4000.000 millions. Second installment of Rs. 1500.000 millions is due in June 2010 and the balance amount is receivable by September 2010.
The Company had applied to the Central Government seeking exemption from attaching the documents referred to in Section 212(1) of the Companies Act, 1956 (Act). In terms of the approval granted by the Central Government under Section 212(8) of the Act, a copy of the Balance Sheet, Profit & Loss Account, Reports of the Board of Directors and Auditors of the CITL for year ended March 31,2010 have not been attached with the financial statements of your Company. However, the annual accounts of the CITL will be made available to the shareholders of the Company or CITL, who seek such information and these are also open for inspection by any such shareholder at the Registered Office of the Company and of the subsidiary company. The statement on financials of CITL pursuant to the approval under Section 212(8) of the Act, forms part of the Annual Report.
Industry Structure and Developments :
The Indian telecom services sector has witnessed tremendous growth in the recent past, primarily driven by intense competition, entry of new operators and falling tariffs.
In India, there are various kinds of telecom service licenses, including access licenses, i.e. basic/fixed service, cellular, Unified Access (basic + cellular) service; carrier licenses, i.e. national long distance and international long distance; licenses for internet services; VSAT licenses; and IP-1 registration for passive infrastructure (towers, ducts, fiber). Unified Access Service License ("UASL') operators like the Company can provide, besides fixed & mobile services, internet, internet telephony and broadband services under their UASL license. Unrestricted competition is allowed in all the categories.
Regulatory Developments :
Details of major developments on the regulatory front are as under:
Access Deficit Charges
The Telecom Regulatory Authority of India ("TRAI") had abolished Access Deficit Charges ("ADC"), a levy paid by private telecom operators to Bharat Sanchar Nigam Limited ("BSNL:') for meeting the cost of unprofitable operations in rural areas, w.e.1. April 1,2008. The ADC component on the international incoming calls was fixed at a reduced rate of Rs. 0.50 per minute for the period from April 1,2008 to September 30,2008 after which this component of ADC was also eliminated. Now all domestic and international calls are free from the incidence of ADC.
BSNL challenged these ADC amendments before the Telecom Disputes Settlement and Appellate Tribunal ("TDSAT") for the financial years 2006-07, 2007-08 and 2008-09. The TDSAT has dismissed all the appeals. Appeals have been filed by BSNL before Supreme Court against these orders of the TDSAT Being statutory appeals these have been admitted by Supreme Court. However, no stay ofTDSAT order has been granted.
Telecommunication
Interconnection Usage Charges Regulation,
2003
The TRAI amended Telecommunication Interconnection Usage Charges Regulation, 2003 vide Telecommunication Interconnection Usage Charges (Tenth Amendment) Regulations, 2009 which effective April 1, 2009 reduced termination charges for all types of domestic calls viz. fixed to fixed, fixed to mobile, mobile to fixed and mobile to mobile to 20 paise per minute from 30 paise per minute, and increased termination charges for incoming international calls to 40 paise per minute from 30 paise per minute. This change has been challenged by incumbent operators before the TO SAT The Company, Tata Teleservices Limited ("TTSL:') and Association of Unified Service Providers of India ("AUSPI") have filed an appeal demanding a 'Bill & Keep' arrangement. Arguments in all these appeals have been concluded in March'2010. The final judgment is awaited.
Mobile Number Portability
Mobile Number Portability ("MNP") is a service that allows end-users of telecommunication services to retain their
Current mobile telephone number when they switch from one operator to another. In November 2007, the Department of Telecommunications ("DoT"), accepted TRAI's recommendations of March 2006, on MNP. DoT has divided the country into two MNP Service Zones and has signed license agreements with two companies to set-up and operate MNP. According to DoT, MNP is expected to be launched across
Spectrum
(a) Allocation of 3G Spectrum
DoT had issued Notice Inviting Application (NIA) on February 25, 2010, kick starting the auction process. Auction
process started on April 9, 2010 for 3 slots in 17 circles and 4 slots in 5 circles. Reserve price for all 22 circles (one slot of 2x5 MHz per operator) was Rs. 35000.000 millions. Nine service operators participated in the 3G spectrum auction which ended on May 19, 2010 .
The Company has succeeded in winning the bid for 3G spectrum in Maharashtra circle (excluding Mumbai but including
(b) Guidelines for allocation of additional Spectrum
Based on
TRAI recommendations (which discriminate between GSM and COMA operators by allotting spectrum in a 2:1 ratio based on the unsubstantiated presumption that COMA technology is significantly more spectrum efficient), DoT
issued fresh spectrum
allocation
guidelines in January 2008, increasing substantially the subscriber number
thresholds, making it more difficult for established service providers to acquire more spectrum and improve
their quality of service to subscribers. DoT had set up a committee on June 16, 2008 to review the spectrum allocation criteria. TOSAT, in a recent judgment, has held that the TRAI recommendations were made in a non-transparent manner and has advised DoT to issue fresh guidelines alter getting the Second Spectrum Committee
report. Second Committee submitted its report on May 13, 2009 recommending auction of 2G spectrum
beyond initial allotment of spectrum of 4.4 MHz. Report had been referred by DoT to TRAI. TRAI has submitted its recommendation on Spectrum Management and Licensing Framework on May 11,2010.
In its recommendation of May 11, 2010, TRAI has capped the spectrum allotment to G5M and COMA. It has recommended that committed spectrum is 6.2 MHz for G5M and 5 MHz in respect of COMA. 'Prescribed limit' of spectrum i.e. the amount of spectrum that can be assigned by the Government would be 8 MHz/5 MHz (GSM/COMA) in the whole of the country except in the metro service areas 01 Delhi and Mumbai it would be 10 MHz/6.25 MHz. However, spectrum assigned beyond committed amount of 6.2/5 Mhz (GSM/COMA) will be paid for at the 'Current Price' which is to be a price linked to 3G price derived through bidding. TRAI will submit by July 15, 2010
supplementary recommendations on Current Price for 1,800 MHz spectrum. TRAI has also recommended license fees to be brought down to 6% over the next four years and has made recommendations for facilitating Mergers & Acquisitions. DoT is expected to take decision on these recommendations after receiving supplementary recommendations.
Use of Alternate Technology
DoT had issued on October 19, 2007, a press release permitting the use of alternate wireless technologies by UAS Licensees. UAS Licensees who were using COMA technology for wireless access are now permitted to use GSM technology and vice-versa. In August 2008, the Hon'ble Delhi High Court upheld the Government's decision. On March 31, 2009, TDSAT dismissed a petition filed by the Cellular Operators Association of India ("COAl") and other GSM operators against the
Government's decision to allow dual technology. TDSAT also directed DoT to immediately review the subscriber base of BSNL and Mahanagar Telephone Nigam Limited ("MTNL.:') in all the circles and withdraw the spectrum allocated beyond the criteria laid down by DoT. The Hon'ble Supreme Court on appeals by B5NL and MTNL. has for the time
being, stayed
such requirement to surrender the spectrum.
The AU5PI has made several representations to DoT and suggested that the validity of dual technology (G5M spectrum) should be
20 years from the date of amendment of the license or if the validity cannot be increased to 20 years and the excess amount
cannot be refunded, same may be adjusted against future license fee and spectrum charges payable against
the licensed operations. The Government has not responded to these suggestions by AU5PI and TRAI also has not addressed this issue in its recommendation dated May 11,2010.
Security Clearance Before Purchase of Equipment
DoT vide letter dated December 3, 2009 has amended the UASL agreement asking all the service providers to take security clearance from DoT before placing purchase orders. On the representation by industry, different format was issued for submission of the request, last being on February 25,2010. On March 18,2010, DoT issued further clarification stating that service providers need not seek approval of passive and indigenous equipment. This created a situation where Licensees have not been able to import network equipment since December 3, 2009. On March 26, 2010, the Company received a DoT letter informing that import of equipment from M/s. ZTE, Huawei, Tong Yu Hong Kong Co. Ltd. from
Re-verification of
DoT vide their
letter dated September 30,2009 has allowed all the operators to re-verify the
subscriber from October 1, 2009
till October 31,2010 to avoid penalty.
Quality of Service (QOS)
~ For customer complaints, service requests, Value Added Service ("VAS") deactivation
and service termination
toll free number 198 has been activated. This will be
a common number for all service providers for all products.
~ Performance parameters of Network,
Billing and Customer Care are required
to be published on the website each quarter. An
online Telecom Consumers Grievance Monitoring
System is likely to be introduced.
Efficient Utilization of Numbering Resources
The availability of new numbers is under severe pressure in view of
the rapid growth of
mobile connections. The TRAI has initiated discussions to review the current method of allocation and sought
suggestions for making more numbers available in the 10 digit format.
They are also considering for
the long term the feasibility of using
11 digit
format. The possibility of re-allocation of levels
now allotted for fixed line numbers to mobile is high.
OPPORTUNITIES AND THREATS
The Company offers COMA and
GSM telecom services in Mumbai and
Maharashtra
(comprising Maharashtra and
Winning the bid for 3G Spectrum in
Rest of Maharashtra (including
In Mumbai, which in comparison
has a significantly smaller population of
around
20 million people, the
Company already
has multiple telecommunication assets including its
EDGE enabled GSM platform, a substantial wire line broadband access infrastructure and extremely successful wireless broadband services offered on the
COMA platform through
the Photon' offerings, all of which the
Company will
continue to leverage
effectively.
The year witnessed the launch of new Value Added Services (VAS), revenues from
which are expected
to bolster the Company's revenues significantly in
the coming
years. Information on important litigation concerning the Company is
as under:
Spectrum
The Company
and TTSL filed in December 2007, a
petition before TDSAT:
-
Challenging allocation
of spectrum beyond the contracted
amount to GSM operators;
-
querying the
pricing of spectrum beyond
the contracted amount and recommending,
if necessary, withdrawal of excess spectrum allocated to GSM operators;
-
seeking
release
of the 3" and 4'" CDMA carriers (within the contracted amount of 5+5 MHz) against its pending applications;
-
seeking upfront allotment of the contracted
5+5 MHz spectrum to COMA
operators, as
was done in the case of GSM operators;
and
-
demanding technology neutrality.
DoT assured TDSAT that
spectrum would be allocated against the pending
applications. However, without allocating spectrum
against
pending applications, DoT enhanced substantially the
subscriber number
requirement for spectrum allocation
eligibility in
January
2008. The TDSAT was
waiting the recommendation of TRAI on
the report of
the Expert committee. TRAI has made its recommendations on May 11,2010 .The petition would now be heard on July 12,
2010.
Push-to- Talk
The Company,
after holding discussions with
TRAI, launched in November 2004, the innovative Push-To-Talk
("PTT") service on a non-chargeable basis. PTT enables subscribers to form groups and
instantly connect with multiple persons across the country who require short bursts of information, thus increasing productivity and efficiency while simultaneously reducing costs. Commencing January 2005, DoT and TRAI sought some information, which was furnished, after which they directed the Company in February 2005, to discontinue the service, which was done. DoT thereafter
levied a penalty of Rs. 500.000 millions on the Company in February 2006, for alleged violation of ISP license conditions; this was challenged by the Company before the Hon'ble TDSAT. The TDSAT vide its judgment dated December 18, 2009 allowed the Petition filed by us and set aside the penalty imposed by DoT. The DoT subsequently preferred an appeal before the Hon'ble Supreme Court (SC) against the TDSAT judgment which has been dismissed by SC.
Computation of License Fee
TDSAT in its judgment of July 2006, had laid down the principle that revenues accruing from non-licensed activities should not attract license fee and directed TRAI to prepare a list of items to be included and excluded from Adjusted Gross Revenue ("AGR') which attracts license fee.
The matter was decided in 2007 by TDSAT, which based on TRAI recommendations identified various items to be excluded from AGR. The order would be effective from the date of filing of petitions in TDSAT. DoT has filed an appeal in the Hon'ble Supreme Court challenging the whole order, while the Company and TTSL have filed an appeal seeking implementation of the order from the first demand for the year 1999-00, raised by DoT in May 2003.
Fulfillment of Roll-out Obligations
As a UAS Licensee, the Company was required to complete certain rollout obligations within 1" and 3'" years from the effective date of its license(s). The coverage had to be certified by the
Despite various representations from the industry and the Company, DoT on June 4,2007, issued show cause notices to the Company and other operators alleging non-fulfillment of the stipulated rollout obligations at the end of the first year. The notices required the Company to explain to DoT, why liquidated damages of Rs. 140.000 millions (i.e. Rs. 70.000 millions each for Mumbai and
Special Audit by DoT
DoT appointed a firm of chartered accountants as special auditor to conduct audit of license fee payments during the FY 2006-07 and 2007-08. The report of the special auditor has been submitted to DoT in last week of May ~
Outlook :
The outlook for the Company appears bright on a long-term basis. It successfully launched GSM services under Tata Docomo brand in Mumbai and
The Company will also benefit from its association with TTSL, which has licenses to provide telecom services in 20 circles across
The national teledensity is around 54% mark and considering the teledensity of other regions and countries in Asia, there is a vast market in
The Company expanded its network throughout the States of Maharashtra and
The Company has been late entrant in COMA and GSM 2G services, but it now has an opportunity to be on par with other operators as for providing 3G services. The Company's Photon' high speed internet services along with some strategies will enable it to compete in Mumbai, where it did not pursue bid for 3G spectrum due to exorbitantly high bid price.
FIXED ASSETS
· Leasehold assets
· Land
· Office Premises
· Building
· Plant and Machinery
· Own
· Acquired under
· Finance Lease
· Furniture, Fixture and Office Equipment
· Vehicles
INTANGIBLE ASSETS:
· License
· Computer Software
WEBSITE DETAILS
PROFILE:
Subject
spearheads the Tata Group's presence in the telephony sector in the telecom
circles of Maharashtra and
Subject
commenced landline operations in 1998 and today has the largest wire line base
in Mumbai and
Subject’s
network has been rated as the only congestion-free network across
The
Company has been responsible for a number of innovations over the years,
including its market introductions last year of 1 GB memory USB wireless
modems, the world’s first CDMA AM/FM Radio Phone, the Ganesha-motif Sumukha
phone, the launch of the Novatium sub-$100 PC in Mumbai, and, for the first
time, a 100 Mbps to the home ethernet-based broadband service.
Leveraging
its high quality buried fibre Next Generation Network extending over 1500 kms
in Mumbai, Subject recently announced its vision for Digital MumbaiTM –
broadband anytime, anywhere in Mumbai city.
The
Company has also been allocated GSM spectrum recently, and will be launching GSM
services in Mumbai and
With
the full portfolio of products and services required by different categories of
retail and enterprise consumers, and an excellent network backed by good
customer care, subject is well positioned to lead the market in the years
ahead.
The
Company is listed on the BSE and the NSE, and has over 600,000
shareholders. Its revenues for the fiscal 2008-9 were in excess of
Rs.20000.000 Millions, with an EBIDTA of around 29%.
CMT REPORT (Corruption, Money Laundering
& Terrorism]
The Public Notice
information has been collected from various sources including but not limited
to: The Courts,
1] INFORMATION ON DESIGNATED PARTY
No records exist designating subject or any
of its beneficial owners, controlling shareholders or senior officers as
terrorist or terrorist organization or whom notice had been received that all
financial transactions involving their assets have been blocked or convicted,
found guilty or against whom a judgement or order had been entered in a
proceedings for violating money-laundering, anti-corruption or bribery or
international economic or anti-terrorism sanction laws or whose assets were
seized, blocked, frozen or ordered forfeited for violation of money laundering
or international anti-terrorism laws.
2] Court Declaration :
No records exist
to suggest that subject is or was the subject of any formal or informal
allegations, prosecutions or other official proceeding for making any
prohibited payments or other improper payments to government officials for
engaging in prohibited transactions or with designated parties.
3] Asset Declaration :
No records exist to suggest that the
property or assets of the subject are derived from criminal conduct or a
prohibited transaction.
4] Record on Financial Crime :
Charges or conviction registered
against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or investigation
registered against subject: None
6] Records on Int’l Anti-Money
Laundering Laws/Standards :
Charges or investigation
registered against subject: None
7] Criminal Records
No available information exist that suggest
that subject or any of its principals have been formally charged or convicted
by a competent governmental authority for any financial crime or under any
formal investigation by a competent government authority for any violation of
anti-corruption laws or international anti-money laundering laws or standard.
8] Affiliation with Government :
No record exists to suggest that any
director or indirect owners, controlling shareholders, director, officer or
employee of the company is a government official or a family member or close
business associate of a Government official.
9] Compensation Package :
Our market survey revealed that the amount
of compensation sought by the subject is fair and reasonable and comparable to
compensation paid to others for similar services.
10] Press Report :
No
press reports / filings exists on the subject.
CORPORATE GOVERNANCE
MIRA INFORM as
part of its Due Diligence do provide comments on Corporate Governance to
identify management and governance. These factors often have been predictive
and in some cases have created vulnerabilities to credit deterioration.
Our Governance
Assessment focuses principally on the interactions between a company’s
management, its Board of Directors, Shareholders and other financial
stakeholders.
CONTRAVENTION
Subject is not
known to have contravened any existing local laws, regulations or policies that
prohibit, restrict or otherwise affect the terms and conditions that could be
included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs. 45.16 |
|
|
1 |
Rs. 70.64 |
|
Euro |
1 |
Rs. 58.68 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
OPERATING SCALE |
1~10 |
5 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
5 |
|
--PROFITABILIRY |
1~10 |
3 |
|
--LIQUIDITY |
1~10 |
5 |
|
--LEVERAGE |
1~10 |
5 |
|
--RESERVES |
1~10 |
5 |
|
--CREDIT LINES |
1~10 |
5 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
43 |
This score serves as a reference to
assess SC’s credit risk and to set the amount of credit to be extended. It is
calculated from a composite of weighted scores obtained from each of the major
sections of this report. The assessed factors and their relative weights (as
indicated through %) are as follows:
Financial condition (40%) Ownership background (20%) Payment
record (10%)
Credit history (10%) Market trend (10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with full
security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
- |
NB |
New Business |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.