Bharti Infratel plans to talk tower sharing with Reliance

Written by feBureau | New Delhi | Updated: May 1 2013, 09:13am hrs
The telecom tower arm of Sunil Mittals Bharti Airtel plans to talk to the telecom unit of Reliance Industries to lease out towers, a top company official said on Tuesday.

We would definitely be in talks with them. We would like to do more and more business with them they are very credible customers, said Bharti Infratel vice-chairman and managing director Akhil Gupta.

In line with Mukesh Ambanis strategy to find collaborative cost effective infrastructure tie-ups, as he gears up for a second innings in the telecom space, Reliance Jio Infocomm has already inked a deal with RCom to share fibre-optic backbone infrastructure and signed an agreement with Bharti Airtel to lease capacity on its i2i undersea cable network.

Industry experts said the move indicates that senior Ambanis partnerships would not be restricted to younger brother Anil Ambanis telecom firm. RComs subsidiary Reliance Infratel owns 45,000 telecom towers while Bharti Infratel has a total of over 80,000 towers.

Such deals are good from industry point of view as it results in sharing of infrastructure which is costly to build. It is part of industry consolidation and could be a winwin for all including the ultimate consumer, said Hemant Joshi, partner, Deloitte Haskins & Sells.

Analysts said that a tower sharing deal will depend on location coordinates and tenancy capacities. In terms of a deal, a tower operator with higher tenancy ratio (the number of tenants per tower) can offer lower rentals, however, others with lower ratios can offer better sharing capacities.

Reliance Infratel operates towers with a tenancy ratio of 1.74, while the same stands at 1.91 for Bharti Infratel.

Reliance Jio officials have maintained that the companys model would be asset light, based on a range of partnerships where buying any equity in any other company is totally ruled out. Reliance Jio is the only operator to have spectrum in all the 22 circles to provide broadband wireless access (BWA) services. It is yet to start these high speed data services.

Bharti Infratel also expects faster network rollout in India by mobile carriers this fiscal, Gupta told reporters at a news conference. We would be focusing on two factors of growth, increasing tenancy ratio as well as growth in tower rollout by operators to meet growing network demands in rural areas as well as to feed the increasing customer demand for data, said Gupta.

The company expects that with telecom operators focusing on network rollout in circles where they won spectrum during the recent auctions, there would be increased demand for mobile towers.

Bharti Infratel net rises 34.3% to R287 crore

fe Bureau

New Delhi, April 30: Bharti Infratel, the mobile tower unit of Bharti Airtel, on Tuesday reported a 34.3% increase in its net profit at R287 crore during the quarter ended March compared with R214 crore in the corresponding quarter last year.

Total income of the company during the January-March 2013 period rose to R2,674 crore against R2,403 crore in the corresponding period of 2012, an increase of 11.3%. At the end of March quarter, total tower base stands at over 82,000 with average sharing factor at 1.91. Sharing revenue per tower per month showed an increase of 1.8% to stand at R66,919.

Despite relatively low capex deployment by telecom operators last year due to uncertainties in telecom sector, our results reflect the significant incremental gains from increased sharing of our infrastructure. With data growing at a fast pace and focused approach by new operators, we expect increased deployment of new networks by operators in the coming year, said Bharti Infratel vice-chairman and managing director Akhil Gupta.

Consolidated Ebitda improved from R911 crore to R1,008 crore, up 10.6% year-on-year. Consolidated operating free cash flow for the quarter was at R494 crore, which represents a decrease of 11% over the corresponding period last year on account of higher capex in the current quarter.

The board of directors have proposed a full-year dividend of R4 per equity share for the year ended March (including interim dividend of R1 per share already paid during the quarter ended September 2012). The total dividend payout inclusive of R125 crore as tax on dividend will amount to R865 crore.

Consolidated revenues for the full fiscal 2013 stood at R10,272 crore, an increase of 9% over the corresponding period last year and consolidated net profit reported a growth of 34% at R1,003 crore. In December 2012, the company raised more than R4,118 crore via an initial public offer.