GTL Infrastructure Limited is a leading independent telecom tower company. It provides passive infrastructure on a shared basis for telecom operators to host their active network components. In this interview, Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure, explains what his business is doing to support 4G in India; talks about his company’s plans to increase tenancy ratios; and explains why GTL Infra is about to embark on a debt conversion plan.
TowerXchange: Can you tell me about your company and your personal background in telecoms?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
GTL Infrastructure Ltd (GTL Infra) is in the business of shared passive telecom infrastructure. We have around 28,000 towers across India, which allow us to bring connectivity at affordable prices to the masses and create a positive impact on the economy.
The group as a whole has revenues of around US$500mn and operations in Asia Pacific, Europe and the Middle East.
It is worth mentioning that our tower portfolio serves all of the major cellular operators in India. We have a business model of infrastructure sharing that is based around building, owning, operating and maintaining the passive telecom infrastructure sites that are used by multiple service providers.
There are many benefits that our customers get from working with us, but for the purpose of this article I would like to pick out three. Our telecom infrastructure and services allow operators to reduce capex and opex through shared infrastructure, to reduce energy costs and enjoy faster rollouts.
Before taking up my current position at GTL Infrastructure, I headed the M&A function for the global group. Prior to that, I held senior positions with Crompton Greaves, Aptech and The Thapar Group. In total, I have over 25 years’ of experience in telecoms and ITES across business operations and strategy; sales and marketing; business and market development; as well as P&L, and have worked all over the world.
TowerXchange: What can you tell us about the recently announced debt conversion plan?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
Over the last six years both our companies have reduced domestic debt from a high of Rs. 12,000 crores down to Rs. 8,300 crores. Current SDR, conversion of bonds and promoter loans into equity are expected to dramatically reduce the debt further to Rs. 4,800 crores. Details will be known through the stock exchange releases.
18 to 24 months after SDR, we plan to bring this debt down substantially further, helping to generate cash to modernise our network and add 10,000 to 12,000 more tenancies, subject to fulfillment of uptime of network operations.
18 to 24 months after SDR, we plan to bring this debt down substantially further, helping to generate cash to modernise our network and add 10,000 to 12,000 more tenancies
TowerXchange: Please tell us about your portfolio: the assets you have on the ground, your geographical footprint, and your ratio of ground based to rooftop towers.
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
GTL along with its associate company CNIL (Chennai Network Infrastructure Ltd) has around 28,000 telecom towers spread across all telecom Circles. We are the only independent and truly neutral company with a pan-India presence.
In addition, we have a very good mix of both rural and urban infrastructure. Approximately, 65 to 70% of our towers are Ground Based Towers (GBT), while most of our rural GBTs are between 50 and 60 metres in height. This is a clear advantage to the operator today – the height advantage is beneficial when it comes to QoS.
I should also mention that we are present in all of the twenty-two telecom Circles. In particular, we have a strong presence in the circles of Tamil Nadu, Karnatka, UP-East, J&K, NorthEast, Assam and Bihar. All of these circles have grown since last year. I should also point out that the coverage and penetration in these circles has been lower historically, and therefore operators are focusing on these circles for rollouts to tap into their potential.
TowerXchange: Can you give us some guidance about your tenancy mix?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
Currently, GIL along with its associate company CNIL has approximately 45,000 tenancies with a tenancy ratio of around 1.8x on radiating towers.
Due to a good portfolio in growth markets like Bihar, UP-East, NorthEast, Assam and J&K, amongst others, we expect to receive sizable tenancies in these circles, helping us improve our tenancy ratio in record time.
Amongst other tower companies today, we have the all-important capacity to quickly offer access to new entrants and help them rollout in the shortest possible time. I should also mention that we work with all telecom operators in India today.
TowerXchange: What are some of your strategies to lower opex?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
We have taken several measures to lower opex. First of all, we have optimised our site security; our overall security cost has been drastically reduced through innovation. In addition, we are deploying deep discharge batteries to reduce DG run hours and diesel consumption.
As part of this programme, we are also introducing a state-of-the-art central Network Operations Centre (NOC) in Pune which will track site performance, fleet deployment and fault resolutions around the clock.
In a bid to cut costs further, we have also focused on network rectification over the last 18 months. As part of this process, we are currently working in consultation with customers to improve network quality. We are also working with petroleum companies on a programme for diesel filling and cash-less dispensing. Lastly, we are working with customers to close fixed energy management contracts, thus improving cash flow.
TowerXchange: What opportunities has the rollout of 4G created for your business?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
This year, all the leading operators have been focusing on data services, and average data usage per subscriber has been rapidly rising. The launch of RJio has also triggered greater competition amongst operators to expand their 4G network coverage.
This year, all the leading operators have been focusing on data services, and average data usage per subscriber has been rapidly rising. The launch of RJio has also triggered greater competition amongst operators to expand their 4G network coverage
Thanks to these developments, we have received business from all the leading telecom operators, including RJio, the new entrant. Each operator has a unique mix of spectrums from 800 to 2300MHz. However, 4G is largely being rolled out on higher frequencies. Higher frequencies bring with them higher propagation losses. Therefore, to maintain QoS, a large number of cell sites are required i.e. tenancies. And due to higher propagation losses on higher frequencies, operators also require additional sites even in an existing coverage area.
Over the last few years, new entrants as well as some of the leading operators have carried out a number of fresh rollouts. One of GTL’s strengths lies in making sites ready for sharing thanks to quick upgrades to meet and surpass operators timelines, therefore we have been able to receive a large share of the service orders in this category.
TowerXchange: What can you tell us about your recent deal with Reliance Jio for 6,000 tenancies?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
GTL Infra and its associate company CNIL have signed a site sharing agreement with RJio which includes energy management services across all the telecom Circles of India. The independent and neutral status of GTL Infrastructure has allowed us to rollout a sizeable numbers of tenancies for RJio. We hope to continue working with RJio in the future.
TowerXchange: Will GTL be bidding for any of the Smart City contracts - if so what is your proposition as an enabler of Smart Cities?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
We will continue to watch and observe this space and will take a decision in the future.
TowerXchange: What is your procurement model and process – is it in-house? Who are the key stakeholders?
Milind Bengali, Chief Operating Officer – Business Operations, GTL Infrastructure:
We have our own central purchase process led by a committee which is supported by the supply chain team.
