Homegrown telecom equipment maker HFCL will invest about Rs 200 crore for manufacturing 5G fixed wireless access (FWA) consumer premise devices and on research and development (R&D) related to the technology, the company’s managing director Mahendra Nahata told FE in an interaction.
For manufacturing the consumer premise equipment (CPE) for FWA, the company will set up a manufacturing facility in Delhi-NCR with an initial capex of Rs 100 crore out of the Rs 200 crore planned investment, over the next one year. The remaining Rs 100 crore has been earmarked for R&D.
“Besides setting up our own facility, we will also loop in contract manufacturers like VVDN and others, to make CPEs,” Nahata said, adding that the same can have a capacity of producing 1 million CPE units every year.
At its upcoming facility, HFCL will not only manufacture FWA CPE, but also other products like WiFI access points, routers, backhaul radios, among others.
At the India Mobile Congress on October 27, the company launched India’s first indigenous 5G FWA CPE solution, that supports both 5G standalone architecture (SA) and non-standalone architecture (NSA) technologies across multiple Sub-6 GHz and mmWave (millimetre wave) frequency bands to offer cost-effective and fiber-like speeds to customers using the 5G network.
Given the launch of 5G AirFiber services by Airtel and Jio, the launch of CPE is crucial for HFCL to cater to the $9 billion a year market.
“We will be soon going into the market with our FWA CPE and we expect a good market opportunity not only from India but internationally also as the 5G deployment is going on,” Nahata said.
When asked about concerns related to higher cost of FWA CPEs compared to fiber broadband services, Nahata said, “Cost of CPE has become quite reasonable. Today, we are around $130 or so and using one equipment you (telcos) can give multiple connections”.
“So, price wise it is competitive, but the advantage is you can roll out FWA very fast as it is a wireless network, compared to putting fiber that takes time,” Nahata said.
Apart from FWA, HFCL is a major manufacturer of optical fiber cable as well. It currently has a optical fiber cable capacity of 25 million fiber km per annum. The company also looks to leverage opportunity from the Rs 1.39 trillion BharatNet phase 3 project.
HFCL is also a beneficiary under the telecom production-linked incentive scheme. The company has committed an investment of around Rs 425 crore towards development and manufacture of various eligible products under the PLI scheme.
On update with regard to PLI scheme, Nahata said, “we have started the production and we will be able to claiming the incentives in a year’s time”.
In the July-Septermber quarter, HFCL’s revenue rose nearly 12% sequentially to Rs 1,111.5 crore and its net profit fell 7% QoQ to Rs 70 crore. The company has an order book of Rs 7,078 crores.
Among other product announcements, the company also launched 2 Gbps unlicensed band radio (UBR) for 5G radio access network backhauling and carrier-grade enterprise last-mile connectivity.