As telecom 2.0 unfolds in India with allocation of 3G spectrum to telecom companies, smaller technology support and services companies, are getting a call to the party.
They are angling for a chunk of $20 billion IT spending
MUMBAI: As telecom 2.0 unfolds in India with allocation of 3G spectrum to telecom companies, smaller technology support and services companies, operating on the fringes, are getting a call to the party.
Be it Hyderabad-based Prithvi Information Solutions, or Sasken Technologies in Bangalore, or Mumbai-based GTL Ltd, the mantra is to acquire capabilities and be at the right place at the right time. These firms are eying the $20 billion telecom ICT spend in India, of which 25% is on network infrastructure spending.
Speaking to DNA Money, V Satish Kumar, MD of Prithvi Information Solutions, said, “Telecom is going to contribute 35% to our revenue from existing 25% in the next 2-3 years.”
Though the BSNL contract is its first telecom deal in India, yet the company already earns close to $4-5 million a year as part of its service to Ericsson to manage telecom major Bharti Airtel’s network. Says Kumar, “As Bharti Airtel expands its services to newer geographies (which it has with the allocation of 3G spectrum, recently) our service to Ericsson would continue for longer term.” Currently, the India revenue for Prithvi is only 4% of its total revenues but in next two years it aims at increasing the share to 35%.
On February 4, Prithvi Information Solutions announced Rs 300-crore order from BSNL to supply and deploy transmission equipment that helps increase network bandwidth, for the telecom major.
Meanwhile, V Satish Kumar is looking to acquire two companies in the US with infrastructure management and network management capabilities. The company has lined up an investment target of $20 million for this. Prithvi has also initiated its recruitment drive earnestly. Within 6 months, the company aims to increase its workforce of 1,800 to 2,200 with 650 professionals dedicated towards telecom.
Rajesh Jain, an IT analyst at KPMG India, feels the vigour from smaller telecom support firms was expected. “The telecom sector is one of the fastest evolving sectors of the country. This is the reason why it makes sense for second-tier ICT support players to look at the India market.”
One of Prithvi Information’s competitors, GTL Ltd too aims to acquire companies in Europe for which a kitty of $200 million is ready.
Charudatta Naik, a wholetime director at GTL, said, “Close to 65% of our revenue comes from India and we are looking at 35% of growth. To achieve this we are looking at acquiring companies with 3G network competencies.” Although with the acquisition of UK-based Genesis Consulting, GTL has acquired the 3G capability for network sharing, but the “next acquisitions in 3G space would be to have the capability to provide clients active component sharing too,” says Naik.
“Through our acquisitions, we are aiming at acquiring capabilities to provide end-to-end solutions in the network rollout space,” says Naik. He is upbeat on the 3G spectrum rollout. Sasken Technologies is too looking upbeat on India telecom story. Swami Krishnan, vice president - global business operations & chief marketing officer said, “For us the next billion is going to come from India market.”
t_amit@dnaindia.net
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