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Smaller telecom suppliers bloom in downturn

india Updated: May 06, 2009 23:31 IST
Ruchi Hajela

Even as companies across several sectors continue to struggle to survive the slowdown, it is a cool deal in the telecom sector. While larger players like Siemens and Motorola are often in the news for juicy equipment contracts, thriving beneath them are smaller companies that provide other gear, or enable value-added services like content and support services like billing.

Online payment and mobile recharge services provider company Oxigen Services, in which Microsoft picked up 37 per cent stake last year, expects to increase its presence to 3 lakh retail outlets from the existing 75,000 over the next five years. “We have plans for nationwide expansion and we expect our revenue to increase by up to 40 per cent this fiscal,” Pramod Saxena, chairman and managing director, Oxigen told Hindustan Times. The company had a turnover of Rs 1,000 crore at the end of March 2009.

Noida-based telecom and power equipment maker Teracom expects to sell close to 50 lakh units of customer premise equipment like modems and set-top boxes over the next two years while it has sold around 40 lakh equipment products in the last four years. Teracom had a turnover of Rs 725 crore at the end of March 2009 and is eyeing revenue of Rs 1,000 crore by the end of the current financial year, a 37 per cent revenue surge riding on broadband growth in state-owned Bharatiya Sanchar Nigam Ltd.

“We had participated in a bid for Rs 500 crore order deal from BSNL and we expect to close the deal soon,” said Rajeev Venkat, director, Teracom.

Delhi-based One97 Communications, which provides technology services to help telecom operators pump value-added content, earlier this year about $15 million in funding, part of which it plans to use for its expansion and rest to fund smaller technology companies.

“We are more interested in funding technology start-ups with strong intellectual property rights than acquiring any firm that is available for cheap due to the downturn,” said Vijay Shekhar Sharma, its managing director. The 600-employee company is adding to its workforce an average of up to 10 people a week and expects to take it headcount to 1,000 employees by the end of the year. The startup did not disclose revenue figures but aims $100 million revenues by 2010.