Reliance Communications Limited · NSE:RCOM
Reliance Communications — Investor Presentation (May 2010)
48 slides from Reliance Communications's investor presentation, May 2010
Slide 1: Reliance Communications Investor Presentation
Reliance Communications Investor Presentation May 2010
Slide 2: Forward looking statements – Important Note
Forward looking statements – Important Note This presentation and the discussion that follows may contain “forward looking statements” by Reliance Communications Ltd ((“RCOM”) statements RCOM ) that are not historical in nature. nature These forward looking statements, which may include statements r
Slide 3: Contents
Contents Reliance Communications – an integrated telco Wireless Enterprise f Infratel Home Globalcom Key takeaways Wireless | Infratel | Globalcom | Enterprise | Home 3 of 48
Slide 4: Current position of our businesses
Reliance Communications Current position of our businesses Wireless #2 in India, #4 globally (single country), dual technology Largest global private submarine cable network, blue- Globalcom chip global clients One stop shop for all large corporates and SMBs for Enterprise communications, netw
Slide 5: Strategy for focused and profitable growth
Reliance Communications St t g for Strategy f focused f d and d profitable fit bl growth g th Address mass mobility market thru’ GSM with special focus on rural distribution eless Consolidate data market leadership with high ARPU high speed data cards Wire Increased revenue from new service st
Slide 6: Financial Highlights
Reliance Communications Financial Highlights Key Financial Parameters (Rs. Mn) Revenue EBITDA Net Profit 229,485 93,050 60,449 221,323 81,989 54,011 190,678 78,205 46,550 144,683 57,208 31,637 107,664 24,762 4,438 FY06 FY07 FY08 FY09 FY10 FY06 FY07 FY08 FY09 FY10 FY06 FY07 FY08 FY09 FY10 Consistent
Slide 7: Total Revenue and cost management
RCOM Financials C Cost management (% off revenue)… ) Margins 39.5% 43.0% 40.5% 35.3% 100% Network expenses - Increase in network cost due to 90% 11.6% 11.5% expansion of coverage & GSM 19.2% 80% launch 27.9% - Opex of other new businesses like Total Revenue 70% 16.5% DTH, Vanco, etc 17.9% 60% 50%
Slide 8: Contents
Contents Reliance Communications – an integrated telco Wireless Enterprise f Infratel Home Globalcom Key takeaways Wireless | Infratel | Globalcom | Enterprise | Home 8 of 48
Slide 9: Key highlights – 4QFY10
Wireless Business Key highlights – 4QFY10 Acquired 100 million wireless customers in i just j 7 years off going i pan-India World’s y youngest g and ffastest achiever of this momentous landmark World’s 4th operator with 100 million customers t iin a single i gl country t Expanded customer ba
Slide 10: RCOM Bigger: Bigger scale will bring more cost competitiveness
Wireless Business RCOM Bigger RCOM: Bigg scale l will ill b bring i g more costt competitiveness titi Among India’s top 2 operators with 102 mn wireless subscribers - Prepaid subscriber additions drive growth - 96% of total subscribers Key Performance Indicators - Lowest tariffs in the world… wo
Slide 11: Dual network offers significant upsides
Wireless Business Dual network offers significant upsides Three pillars of growth Huge Capex & Opex synergies Only company to offer nationwide GSM & CDMA services Wireless | Infratel | Globalcom | Enterprise | Home 11 of 48
Slide 12: Dual network offers additional market share levers
Wireless Business Dual network offers additional market share levers Existing growth Industry monthly net adds of ~15 mn GSM subscribers momentum Impetus from network expansion in semi-urban/ rural areas Broad Market Segmentation Corporate Requirement Retail/Family Cross technology Similar CUG f
Slide 13: Strategy for increasing revenue market share
Wireless Business Strategy for f increasing revenue market share Gain share of ~ US$ 1 bn international in-roaming market with very high International in- g EBITDA margins roaming i Currently enjoyed by few GSM incumbents + GSM VAS revenue contribution over 10% with SMS contributing ~5% vs ver
Slide 14: SIMPLY Reliance! Plan – One India plan
Wireless Business SIMPLY Reliance! Plan – One India plan Any Any Any Any Any mobile landline customer where time N No No No No conditions packs rentals vouchers Call anyone @ 50p/min; 1p/sec; Re.1/3 mins Wireless | Infratel | Globalcom | Enterprise | Home 14 of 48
Slide 15: Rationale in 'Simply Reliance' tariff plan launch
Wireless Business R ti Rationale l in i ‘Si ‘Simply l RReliance’ li ’ ttariff iff plan l llaunch h Significant traffic in low yield tariffs like Night calling plans Low yield tariffs (5 paise), local on-net plans (30 Paise), etc Significant traffic in unlimited (STD & Local) calling plans CDMA Bucke
Slide 16: Launch of 'Simply Unlimited CDMA Offer'
Wireless Business Launch of “Simply Unlimited CDMA Offer” Takes Simply Reliance initiative to the next level Offers ground-breaking Prepaid CDMA Unlimited Pack that allows unlimited, unconditional talk-time for a one-time monthly charge Maintains the flexibility for all calls to Any Network, A
Slide 17: India's billion people can now expect an unbeatable choice and value proposition
Wireless Business India’s billion people can now expect an unbeatable choice and value proposition across…. 1. Coverage 2. Customer Choice 3. HSD/Internet on the Move 4. Service Innovations 5. 6. Distribution & Reach Customer Trust Set to redefine mobility landscape in India Wireless | Infratel | Gl
Slide 18: Coverage
Wireless Business C Coverage 24,000 Towns 600,000 Villages 1 Billion Indians CDMA GSM Seamless coverage wherever you go Wireless | Infratel | Globalcom | Enterprise | Home 18 of 48
Slide 19: Customer Choice
Wireless Business C Customer Choice Ch i Mobility 102 million Happy customers Wireless Data Fixed Wireless Market leadership in all segments PCO * *CDMA … shall replicate success with nationwide GSM service Wireless | Infratel | Globalcom | Enterprise | Home 19 of 48
Slide 20: HSD/Internet on the Move
Wireless Business HSD/Internet on the Move Competitive differentiation Fastest internet broadband service of up to 3.1 31 Mbps in India’s top 62 cities Seamless handover & connectivity through CDMA g covering 1X in over 24K towns and 6 lakh villages g 90% of the Indian population Wide reach co
Slide 21: Service Innovations
Wireless Business Service Innovations Unlimited local & STD calls Mobile TV Yahoo on Reliance Micro-billing Internet on the move MBanking MPay MBlog Wireless | Infratel | Globalcom | Enterprise | Home 21 of 48
Slide 22: Distribution & Reach
Wireless Business Distribution & Reach World-class design , fit out & ambience att 2,000 2 000 exclusive l i retail t il showrooms h on High streets/Malls High g qquality y reach & national ffootprint p through 5,000 distributors & 1.2 million retailers 5,000+ 5 000+ Direct & indirect outbound
Slide 23: Customer Trust
Wireless Business C t Customer T Trustt …”India’s most trusted service brand” – Economic Times Wireless | Infratel | Globalcom | Enterprise | Home 23 of 48
Slide 24: Financial Performance – Wireless
Wireless Business Fi Financial i lPPerformance f Revenue (Rs. Mn) EBITDA (Rs. Mn) 173,677 66,727 180,000 166,396 152 135 152,135 60,847 60,000 55,861 150,000 120,000 107,276 45,000 39,844 90,000 30,000 60,000 15 000 15,000 30,000 0 0 FY07 FY08 FY09 FY10 FY07 FY08 FY09 FY10 EBITDA Margin 80% 60% 40.0
Slide 25: Contents
Contents Reliance Communications – an integrated telco Wireless Enterprise f Infratel Home Globalcom Key takeaways Wireless | Infratel | Globalcom | Enterprise | Home 25 of 48
Slide 26: Infrastructure Tenancy
Reliance Infratel I f Infrastructure Tenancy T Slots Sl – Market M k RITL Ground based tower 2G, 3G & BWA 700,000 360,000 200,000 RITL Roof top tower 2008A 2009A 2010E Source: Industry Estimates Wireless | Infratel | Globalcom | Enterprise | Home 26 of 48
Slide 27: Infrastructure overview
Reliance Infratel Infrastructure overview Operational in all 22 circles ~50,000 multi-tenancy towers as on March 31, 2010. Anchor customer (Reliance Communications) driven strategy Current tenancy of 1.75x, 1 75x post our GSM launch Aim to be a preferred infrastructure provider for new opera
Slide 28: Telecom infrastructure sharing deals signed
Reliance Infratel Telecom infrastructure sharing deals signed Etisalat DB have spectrum to operate in 14 circles covering 85% of the Indian population Agreement signed for 30 30,000 000 tower sites and transmission connectivity to those sites, sites valuing the 10 year period at Rs. 10,000 crore
Slide 29: Contents
Contents Reliance Communications – an integrated telco Wireless Enterprise f Infratel Home Globalcom Key takeaways Wireless | Infratel | Globalcom | Enterprise | Home 29 of 48
Slide 30: Business Overview
Globalcom Business B i Business O Overview i Data Voice NLD WiMAX Among Top 10 Enterprise # 1 Retail brand for # 1 NLD Spectrum Bank: foray Access Provider in the US calling India from the Infrastructure and to deliver end to end Among Top 5 Enterprise U.S. Bandwidth services broadband on
Slide 31: Customers
Globalcom Business C Customers Reliance Globalcom serves over 200 carriers, 1,500 enterprises and 2.5 million retail ccustomers stomers in 163 co countries ntries across 5 continents Wholesale Enterprise Retail Valuable customer base for application and content distribution Wireless | Infratel | G
Slide 32: Data Business
Globalcom Business Data Business Unmatched Blue Chip Customers Leadership Position Capabilities Global presence in over 60 Diverse base of over 200 Ranked amongst top 5 in countries. World’s largest carriers, ISPs and content Global Network Service IP optical network providers. Providers by Ga
Slide 33: Voice Business
Globalcom Business Voice Business Global Reach Innovative Product Leadership Position Suite Retail services in U.S., Reliance Global Call Market share of 30% for Canada, U.K., Australia, - International Calling Service ILD wholesale inbound New Zealand, Hong Kong traffic - Web based service de
Slide 34: Financial Performance – Globalcom
Globalcom Business Fi Financial i lPPerformance f Revenue (Rs. Mn) EBITDA (Rs. Mn) 83,187 20,000 16,961 80 000 80,000 16 170 16,170 67,909 15,000 14,032 54,750 12,714 60,000 51,771 10,000 40,000 20 000 20,000 5,000 0 0 FY07 FY08 FY09 FY10 FY07 FY08 FY09 FY10 EBITDA Margin 40% 30% 25.6% 20% 24.6% 23.
Slide 35: Contents
Contents Reliance Communications – an integrated telco Wireless Enterprise Infratel Home Globalcom Key y takeaways y Wireless | Infratel | Globalcom | Enterprise | Home 35 of 48
Slide 36: Business overview
Enterprise Business B i Business overview i Fixed Line Voice Data Products IDC WiMax Centrex Internet ((DIA / BIA)) Data centers Predominantly y POTS Leased Lines products SMEs Managed Services Retail customers VPN / MPLS IPLC Ser es Enterprise Serves Enterprise, SME and Retail c
Slide 37: RCOM: Best positioned to drive growth
Enterprise Business RCOM B RCOM: Best positioned i i d to drive d i growth h >50% market share in highest growth data Atlantic products like IDC, Centrex solutions, VPN, etc Fiber Ring Meshed Core 1 Million buildings connected across top 44 cities to our ffiber network,, to cross 1.5 mn by y Pac
Slide 38: 850 of Top 1,000 Indian enterprises are our customers
Enterprise Business 850 of Top 1,000 1 000 Indian enterprises are our customers FMCG Segment Services Segment Telecom Operators IT/ ITES Segment BFSI Segment Media Segment Winning >50% of new business generated in the segment Wireless | Infratel | Globalcom | Enterprise | Home 38 of 48
Slide 39: IDC: Largest in India with >60% market share
Enterprise Business IDC: Largest in India with >60% market share Nine data centres with level 3+ accreditation – more than 400,000 400 000 sq ft of facilities space Hosting >20,000 systems and >1400 terabyte of information Geographic redundancy Wide & complex application hosted - Core Bankin
Slide 40: Financial Performance – Enterprise
Enterprise Business Fi Financial i lPPerformance f Revenue (Rs. Mn) EBITDA (Rs. Mn) 28,386 11,575 11,474 30,000 12,000 25 243 25,243 25,000 8,652 9,000 20,000 17,868 15,000 6,000 5,194 11,441 10,000 3,000 5,000 0 0 FY07 FY08 FY09 FY10 FY07 FY08 FY09 FY10 EBITDA Margin 80% 60% 48.4% 45.9% 45.4% 40.4%
Slide 41: Contents
Contents Reliance Communications – an integrated telco Wireless Enterprise Infratel Home Globalcom Key y takeaways y Wireless | Infratel | Globalcom | Enterprise | Home 41 of 48
Slide 42: Indian Cable & Satellite Market
Home Business Indian Cable & Satellite Market 180 18 160 20 22 140 26 120 33 41 100 110 47 Cable Dark 108 C&S 80 105 DTH 98 60 90 83 40 70 20 45 37 28 21 12 0 2 5 2007 2008 2009 2010 2011E 2012E 2013E Source : Industry y Estimates DTH penetration at 14%; gaining momentum Wireless | Infratel | Global
Slide 43: Reliance Big TV (DTH)
Home Business R li Reliance Bi Big TV (DTH) Pioneering g HD experience p in India Pioneering DVR – “Watch when you want” Key y service differentiators ff - More channel choice - Pure Digital viewing - 32 Cinema channels - Easy program guide - Quick channel select - Interactive applications (iN
Slide 44: BIG TV Services: Complete suite of services
Home Business BIG TV Services: Complete suite of services BroadcastTV and Radio EPG / Mini EPG Mosaic Portal Information News Stock Entertainment Game VoD / MoD / PVR Karaoke / Photo Album Services Advertisments Interactive Promotion Dedicated Advertiser Location Messaging SMS / MMS Mail Polling / V
Slide 45: The 4 Pillars of Growth
Home Business Th 4 Pillars The Pill off Growth G h Content Reach and service 200+ channels 6,500 towns 32 exclusive movie channels 2,000+ exclusive Reliance in English, Hindi and other retail stores regional languages 24x7, 11 language Interactive features – Games, customer service News,
Slide 46: Contents
Contents Reliance Communications – an integrated telco Wireless Enterprise f Infratel Home Globalcom Key takeaways Wireless | Infratel | Globalcom | Enterprise | Home 46 of 48
Slide 47: Drivers for future growth and shareholder value
Looking ahead Drivers for future growth and shareholder value Drivers Impact Peak investment phase is over Increase revenue generating ability Financials at inflection point as GSM and Infratel momentum scales up Large pipeline of untapped business to RCOM not only reliant on wireless business
Slide 48: Thank you
RELIANCE Anil Dhirubhai Ambani Group Thank you
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