Indus sets up less hazardous telecom towers

Indus Towers, a joint venture of Bharti Infratel, Vodafone India and Aditya Birla Telecom for telecom infrastructure, is banking on aesthetic and environmentally less hazardous NextGen towers for areas that see opposition to towers.

It has already put up  over 100 such towers at locations, where it was unable to erect  traditional towers due to resistance from residents, at a cost Rs 20-25 crore.

Bimal Dayal, CEO, Indus Towers, said over the next one year, his tower company will be spending around Rs 100 crore to set up  another 500 towers in 50 cities.

“These are customised solution for sites where we could have never got acceptability from people around to make a site. Hence, it is not necessarily a cost comparative discussion but that of getting a location which was not available to us otherwise,”  he said, when asked how much higher was the cost of such a tower compared to a traditional tower.

Dayal said the NextGen towers help in improving the quality of network and were also more environmental friendly as they were smaller and lower in height.

“Any site that we add in a place where we could not add earlier by using such innovation, definitely improves the network quality, reduces call drops and congestion, which consumers were facing in that area. So, to that extent, it definitely improves the network quality in that area. Also, the new sites are smaller in configuration and lower in height (20-25  meters) hence the power that is emanating from these towers would also be lower than the traditional sites which are 40 meters,” he said.

Indus  Tower, which has around 2.75 lakh tenancies in its 1.21 lakh towers, has reportedly been in news lately due to American private equity firm Providence Equity Partners’ interest in it. There is a strong buzz in  the market that the US-based PE firm was looking to pick up 4.8% stake  of Aditya Birla Telecom (ABT) in the tower company. Currently, Bharti  and Vodafone hold 42% stake each while ABT has 16%. Dayal refused to comment on the speculation.

Currently, Indus is the leader in the telecom tower market with 31% share  followed by Bharat Sanchar Nigam Limited (BSNL) with 18% and Bharti  Infratel with 9.8%.

As per Tower and Infrastructure Providers Association data, there are around 4.5 lakh towers and they are expected to grow by 5% over the next five years.

Further,  exponential growth in data consumption with launch of 4G services by telecom companies, the tenancy ratio of mobile towers may increase to 2.9 by 2020 from 1.95 last year.

Such prospects have seen many overseas tower companies eyeing the space for investment resulting in a huge surge in the valuations of domestic tower companies.