TTML Corporate Presentation-Nov 09

8/8/2019 TTML Corporate Presentation-Nov 09

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Investor presentation

November 2009

Tata Teleservices (Maharashtra) LimitedTata Teleservices (Maharashtra) Limited


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Business overview

TTML spearheads Tata Groups presence in the telecommunication sectorexclusively in the revenue rich circles of Mumbai and Maharashtra

Benefits of economies of national scale with sister company, Tata

Teleservices Limited (TTSL), together with the nimbleness and agility of aregionally focused player

Wireless Wireline Others

CDMA GSM

Landline Leased lines Broadband internet access Video conferencing

Passive infrastructure Distribution outlets

WiFi

9.04 million mobilesubscribers (as of Sep 09)

0.60 million wirelinesubscribers

64K broadband subscribers

2,155 owned towers c.685 exclusive distribution

outlets

9,300 kms of optic fibre cable 1,175 towns and cities across Mumbai and Maharashtra

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Significant ramp up in subscriber base

9,000

10,000

Launched "Digital"

GSM services launched;grabs highest (33.7%)

incremental marketshare in Q2FY09

6 000

7,000

8,000

b s c r

i b e r s

NTT and Tataenter intostrategic

partnership

10millionsubs

Launched "TruePaid" mobile

service

4,000

5,000 0 0 0

s

Crossed 3

Crossed 5 millionCDMA subs Crossed 8

millionCDMA

09)aunc e

CDMA services

2,000

3,000

Crossed half amillion wireline

subs

subs

Tata andVirgin enter

into a JVLaunched Non-Stop-

Oct-09

0

,

Mar-03 Sep-03 Mar-04 Sep-04 Mar-05 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09

Mobile long validityproduct

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Direct play in two of the most lucrative telecom circles in India

India

Maharashtra

(excl Mumbai) Mumbai

Population (mm) 1 1,167 101 20

Wireless subs (mm) 3 471.7 36.3 22.5

Per capita income (INR) 2 33,283 47,051 73,930

Wireline subs (mm) 3 37.3 3.1 2.9

Market subs growth 50% 45% 42%

TTML subs growth(H1FY10 over H1FY09) 62% 52%

Source:1 MMRDA report (Population and Employment profile of Mumbai Metropolitan region), Wikipedia2 Economic Survey of Maharashtra 2008-09;3 TRAI Subscriber Reports (as of Sep 2009)

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Significant scale benefits by aligning with Tata Teleservices

Synergies in procurement Synergies in sales1 2

Joint negotiation with suppliers andservice providers deliveringsignificant economy of scale benefits

Common national billing architectureand joint sales approach towardslarge corporate customers

Common branding Infrastructure sharing

3 4 ommon ac en an ng

platform, serviced for both TTML andTTSL by Tata Consultancy Services(TCS)

TTML benefits from the nationwidebranding and marketing campaignsof TTSL

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Investment highlights

Diversifiedbusinessportfolio

88 22

management

team Strong marketposition

Multi-channeldistribution

platform77 Expansive and

state-of-the-artinfrastructure

Strong brand

positioning

Strong trackrecord in

Revenue andEBITDA

33

growth

66Focus on

innovation 44

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Diversified business portfolio1

Product offerings Customer segments

Mobile Retail

Diversified revenue

ass mar et

StudentGSM

Data / internet- extensive suite of telecom services

- roducts services

Rural market

High value

Executives

Data cards

WiFi

Broadband

catering to specific target

consumer segments

Cross-selling

Youth

SMEs

Large Corporates

Fixed wireline services

Video-conferencing

- ability to leveragecustomer relationships and

provide offering acrossproduct categories

u o-con erenc ng

Leased line circuits

-sold as combo / bundle

Comparatively de-risked business portfolio catering to many consumer segmentsthrough a wide array of products and services

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Strong market position2

Reliance17.3%

Reliance21.0%

Incremental (Q2FY10)Wireline market share End of period (as of Sep 09)

#1 private fixed lineprovider

TTML61.7%

Bharti20.9%

Bharti28.9%

TTML50.1%

#1 Rural Direct ExchangeLine (DEL) provider

(under DoTs Universal ServiceObligation Scheme)

Reliance18.3%MTNL4.3%

BSNL7.3%

Loop4.2%

Wireless market share

#1 operator with

Note: Among private operators

MTNLBSNL6.0%

Bharti4.1% Loop3.9%

Vodafone18.1%TTML

15.4%

rce0.8%

#1 fixed wireless operator

#1 PCO operator

33.1%

Idea10.3%

Aircel5.6%

0.8%

Idea16.1%

Bharti15.5%

Revenue market share hasincreased steadily to 10.3%(Q1FY10)

Robust market osition with a histor of stron rowthRobust market osition with a histor of stron rowth

Note: TRAI, Sep 2009

Reliance21.6%

Vodafone14.5%

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Expansive infrastructure3

State of the art infrastructure integrated with fiber, covering

1,600 kms and 20,000 buildings in Mumbai Supporting TTMLs Broadband Anywhere, Anytime

vision for Digital Mumbai Expansive network layout connecting key business and

5,643

4,000

5,000

6,000

Reliable network with 24x7 support

GSM launch

449 565 679812 939 1,148 1,166 1,175

1,319 1,5381,757 2,059

2,367 2,681 2,703

0

1,000

2,000

3,000

Towns covered (EOP) Wireless cell sites (EOP)

Only congestion free network across Mumbai andMaharashtra

As er successive TRAI re orts

#1

Uni ue com etitive advanta e throu h an extensive fiber network in the cit of MumbaiUni ue com etitive advanta e throu h an extensive fiber network in the cit of Mumbai

# 1 wireless service provider in terms of overallcustomer satisfaction across Mumbai and MaharashtraIndependent studies commissioned by the TRAI

#1

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Expansive infrastructure

1.60

a t i o

ncrease ower ase on e ac o s rong

growth in CDMA and GSM

ncrease ower ase on e ac o s rong

growth in CDMA and GSM

mprove enancy pro e expec e o reac

2.0x by end of FY10

mprove enancy pro e expec e o reac

2.0x by end of FY10

2,000

2,500

r s

1.37 1.41 1.431.52

1.20

.

O c c u p a n c y

404 433 500 519

967 1,059

1,3291,636

5001,000

1,500

N o o

f t o w

1.00Q3FY09 Q4FY09 Q1FY10 Q2FY10

Significantly reduced time to market for GSM launch Spectrum allocation in Sep 2008 and Nov 2008 in Mumbai and Maharashtra, to launch in Aug

Q3FY 09 Q4FY09 Q1FY10 Q2FY10Ground based Roof top

one o e as es ne wor ro ou s

Minimal incremental capex for GSM through reuse of CDMA infrastructure Reused 90% of CDMA sites Initial rollout focused on revenue rich and population dense areas

3G ready GSM and CDMA networks permit reduced time to market for 3G (HSDPA and EVDO Rev-A)launch

Tower business subsidiary provides monetisation options; financial closure achieved in Apr-09 ost o t e s tes we -connecte w t re resu t ng n mprove mar eta ty

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Strong brand positioning4

Support of strong sponsor brandsSupport of strong sponsor brands

Well-known brandinternationally

Innovator and domain-leaderin telecom space

Leverage goodwill associatedwith Tata brand across manyconsumer sectors

Leader in 3G technology

World class product / service brandsWorld class product / service brands

Among themost admiredtelecom servicebrands

Launched witha unique pay-per-second valueproposition

Expresswirelessbroadbandservice

Feature-richwireless phonefor home/officeuse andinternet access

Tailored andrelevantservice togrowing youthsegment

Top Service Brands in IndiaET Brand Equity Ratings 2009#7

Most admired telecom brandDrizzlin Survey, 2009#2

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Innovative product offering5

Hi-Definition Video Conferencing-largest public room roll-out in India

Cisco TelePresence

Fixed wireless phone withinternet access

TATA WALKY

Photon+

Ultra high speed broadbandethernet products (speeds up to100 Mbps to the home)

Power Launcher

Wireless EPABX Gateway

First datacard for wirelessinternet access

Plug2Surf (Photon Whiz)

Express wireless broadbandservice (speeds of 3.1 Mbps)

SERVICESSERVICES

Pa er second billin model

Allows penetration into unwiredbuildings patent filed

Tata DoCoMo Dive-in

first to offer the unique valueproposition, along with TATA

DOCOMO launch

iChannel

Tariff Truepaid first to offer fulltalk time

on op o e pioneered long validity

tariffs

SMS Gateway

Mobile VAS

Focus on market defining products and services - creating a niche as an innovator and

pera or por a content rich design

app ca on ticker updates onnews, stocks, movies,business etc.

ar ners p wNetcore Inc. for BulkSMS

oma n ea er

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Strong track record in Revenue and EBITDA growth6

RevenuesRevenuesAGR market shareAGR market share

8.5%

9.6%10.3%

9.0%

10.0%

11.0%

1,0971,423

1,7902,058

1,023 1,0631 0001,5002,0002,5003,000

I N R c r

CAGR (FY0609): 23%

EBITDAEBITDAConsistent growth in

7.0%

8.0%

Q1FY08 Q1FY09 Q1FY10

0500

FY06 FY07 FY08 FY09 H1FY09 H1FY10

the ramp-up insubscriber base

Mar in erosion in 303486 600

316 279

26.2%

11.4%

21.3%27.2%

28.9% 30.9%

200300

400500600700

E B I T D A

( I N

R c r

)

10.0%15.0%

20.0%25.0%30.0%35.0%

M a r g i n

( % )

CAGR(FY0609): 69%

Capex / SalesCapex / Sales

recent quarters onaccount of one-timeGSM launch expenses

67%1,500 80% s

1250FY06 FY07 FY08 FY09 H1FY09 H1FY10

0.0%.

arge nves men nestablishing a robustnetwork footprint

599 5711,208

807 758

55%40% 39%

0

500

1,000

C a p e x

( I N R c r

)

0%

20%

40%

60%

C a p e x

/ s a

l

( % )

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Multi channel distribution platform7

Multi-channel distribution strategyMulti-channel distribution strategy

Owned / Franchiseestores

c.685 branded storesexclusively retail only

1 st telecom operator inIndia to offer products

Large network of c.1,000 distributors for

Extensive handset /starter pack distribution

services, occupying 0.2million square feet of

prime retail space

Beta site for broadbandcustomers just launched

www.di italmumbai.in

of products

at over 30,000 multi-

brand retail outlets

Rechar e vouchersdistributed throughmore than 60,000

outlets

Among the largest branded telecom retail chain in Mumbai and MaharashtraAmong the largest branded telecom retail chain in Mumbai and Maharashtra

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Experienced management team8

B.Tech from IIT, Delhi; B.E in Electronics from MBA from University of Masters and Doctoratein InternationalRelations from OxfordUniversity

14 years of experiencewithin the Tata Group,including with Tata Sonsat the Chairmans office

Dr. Mukund

IIT, Roorkee

Founding member of thecompany heading theoverall networkresponsibility

30 years telecomexperience, includingsenior responsibilities atHaridev Khosla

Strathclyde

30 years of experiencehaving worked withMicrosoft, Bharti Airtel,Lucent / AT & T, Samsungand TTSL

Milesh Ruparel

Economic Forum as aYoung Global Leader in2007

ManagingDirector

Network & Technology

,Marketing, SCM, HR &

Admin

B.Sc, AICWA, FCA 20 years of experience in

cor orate finance havin

B.Tech (Anna Univ), MBA(BIM, Trichy), MS(Chicago)

B.E in Electronics 20 years of telecom

ex erience havin workedworked with Idea Cellular,Madura Coats, AllerganIndia

S Venkatesan

CFO

14 years of experiencehaving worked with IDBI,Motorola, Tata Infotech

Shankar

VaradarajanVP - PMO

with EscortsCommunications, LGInformation andCommunications and TTSLat various leadershippositionsRaja Srinivas

SVP Strategy &

Projects

B.E from IIT Kharagpur,MBA from IIM Ahmedabad

20 years of experience

having worked with Asian

BE in Electronics & Communications

15 years of experience in

marketing, sales, product

B.Sc. (Madras University) 22 of experience in sales,

marketing and service

functions in FMCG and, ,management for IT & telecom companies

Ramesh IyerVP

Enterprisebusiness

Abdul KhanSVP GSMMarketing

T N SrinivasanVP

CustomerService

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Future Strategy

Network coverage substantiallycompleted; only capacity sites to beadded

Target customer churn fromcompetitors as well as first time users MNP will aid subscriber mi ration

Wireless - CDMAWireless - CDMA Wireless - GSMWireless - GSM

Business expected to generatestrong cash flows

Maximise spectrum utilisation Provide high quality voice and data

Build the Tata DoCoMo brand

Build 3G capabilities 3G-ready network

access capa es

Maintain market leadership across Leverage the vast fibre optic network to

WirelineWireline Data businessData business

Mumbai and Maharashtra Offer range of services including

leased lines, carrier business,conferencing facilities and toll-free

services

offer a range of services, under TTMLs Broadband Anywhere, Anytime visionfor Digital Mumbai

Develop the Wifi network in Mumbai to

reduce last mile costs

Broaden customer base and offer diverse product offerings

Focus on enterprise and high valuesegments

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Thank You

TTML Corporate Presentation-Nov 09

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