RTIL to invest Rs 8,000 crore
The telecom infrastructure unit of Reliance Communications plans to invest Rs 8,000 crore by March 2008 and take its tower strength to 23,000, reports Archana Khatri.business Updated: Sep 22, 2007 00:25 IST
Reliance Telecommunications Infrastructure Limited (RTIL), the telecom infrastructure unit of Reliance Communications that manages the communication towers hived off by the parent, plans to invest Rs 8,000 crore by March 2008 and take its tower strength to 23,000 from the current 14,000. The company also has a target to erect 50,000 towers by 2010.
RTIL also has plans to dilute equity in the company. “We are looking at the option of either an IPO or of selling an equity stake in a period of 6 months to one year,” says Gaurav Wahi, spokesman for Reliance Communications.
A Reliance document, quoting some Mumbai brokerages analysts, sats RTIL’s equity valuation based on market value stands at Rs 27,000 crore, while the overall enterprise valuation based on assets stands at Rs 36,000 crore.
Reliance officials say the equity valuation is based on a price of Rs. 135 per share of Reliance Communications, which has a market capitalisation of around Rs. 120,000 crore.
RTIL had sold 5 per cent equity stakes in July this year for Rs 1,400 crore to institutional investors.
The build-up in tower infrastructure is aimed at feeding expansion plans for GSM networks, infrastructure sharing arrangements, new technology roll outs and the ability to provide engineering, procurement and construction (EPC) services in India and abroad.
The company also plans to increase the existing capacity of 4 tenants per tower to 7 tenants . Wahi said there was a need to build infrastructure in "B and C cities" that had underdeveloped infrastructure.
With the growth in mobile subscribers numbers, the pressure on the operators to provide quality in service is constantly increasing. Mobile subscribers crossed 200 million mark by end August. While the monthly addition of the subscribers was seven million in July alone, it increased to eight million in August.