Tata Comm readies $2bn capex

Tata Communications, a global voice and data telecom provider with annual revenues of $2 billion, has identified ‘20 top emerging markets’ that will drive its next phase of growth. The firm earns two-third of its revenues from overseas businesses. In the last six years, it invested about $1 billion to fund acquisitions (Tele Globe, a stake in Tata Teleservices) and setting up of new submarine cable.

The growth strategy going forward revolves around regions where global multinational companies are setting up operations. That includes countries in Latin America, Africa and South East Asia and Central and Eastern Europe. VSNL will set up infrastructure that will support various telecom enterprise solutions, including tele-presence, manage data services, messaging etc.

Between 2009 and 2011, the company has charted a 12-15% compounded annual growth rate. This means, it will double its revenues to $4 billion and ebitda will grow 20% to about $800 million by 2011-12.Tata Communications, meanwhile, is also investing in a major way in India. It has earmarked a $2 billion capex over three years, its most ambitious plan in its history.For setting up fresh capacities in submarine cable undersea, the company will spend $500 million, Wimax for broadband connectivity for a captive market of 30 million potential subscribers will entail an expenditure of $500 million. Another billion dollars will go for setting up data centres and expansion of its fibre network.

Read more in The DNA Money article.