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Dear Sir,
According to news in certain section of the media, Mr. Mukesh Ambani has agreed to take RIL and give you Reliance Infocomm and Reliance Energy. If that's true I suggest you accept the offer before he changes his mind.
I offer myself for the post of Managing Director of Reliance Infocomm and promise to make it more valuable than Reliance Industries Ltd. in flat two years.
Donot doubt me. Just to prove my point - Bharti with its customer base of around 1 crore customers is valued at about Rs. 35000 crores. And the best future projections for the company would at the best suggest few crore customers more...lets say 5 crores by 2010. Reliance Infocomm has about the same number of customers today i.e. 1 crore and is expected to grow their mobile telephony market at the same pace as that of Bharti. But the difference is that BY 2010 VOICE WILL CONTRIBUTE ONLY 10% OF INFOCOMM's TOTAL REVENUE. Which means, Reliance Infocomm's mobile business would be as big as Bharti and it should be valued as much for its mobile business. But what need to be considered is the rest 90% of Reliance Infocomm business. Another 10% would be contributed by broadband, video on demand, cable TV, video conferencing etc. Another 10% would come from broadcasting and media related activities.
Revenue sources that most people are right now not able to imagine is revenue like from Revenue from Banking system for leasing of bandwidth for Real Time Gross Settlement (RTGS), ATM connectivity, revenue from bandwidth leasing for e-governance, for national network of camera at public places etc. And mind you unlike the voice business in most of these businesses Reliance would have a virtual monopoly.
Infocomm's real strength is its National backbone of optic fiber. Nobody had laid that on the scale at which Reliance had laid and hence would not be able to meet the bandwidth requirement of nation for services other than telecom. Reliance had the foresight to put in 12 ducts while others were investing in one or two. Nobody can now replicate this infrastructure as Reliance already has first mover advantage and has enough capacity to make and additional investment in optic fiber capacity unviable.
All Reliance Infocomm need to do is to invest in the last mile. Connect as many villages as possible in the next 12 months. If Reliance Infocomm can live upto its pledge of reaching 5700 towns and 4 lakh villages by the year-end, it would become invincible. Organizations like RBI, State government, police department etc. Everybody would have no choice but to come to Reliance for bandwidth. Imagine the power Infocomm can command.
Based on the above estimate if 10% future revenue gives a valuation of Rs. 35000 crores, Reliance Infocomm can be easily worth 350000 crores by 2010!!! In 2 year time I promise a valuation of 1,75,000 crores. Yes, to get to that point lot of hard work in terms of setting up the last mile infrastructure is required. At the same time VISION is very important. The limit of this marvelous infrastructure Reliance has created is only that of vision.
And here is where I come in. Excuse me if I sound immodest. But believe me, last eight years of 'Reliance Stalking' has helped me develop capability to dream at the same wavelength at which Mukesh Ambani has been dreaming for this project. Give me opportunity to interact with you, one-to-one for 30 minutes, I promise I will convince you.
If Mukesh is really offering you Reliance Infocomm I suggest you grab it and run. But just make sure that he is also giving up the optic fiber backbone and not just the Mobile business. I just can’t imagine Mukesh would give up this goldmine. I doubt Reliance Communication & Infrastructure Ltd. (RCIL) and not Reliance Infocomm owns that optic fiber infrastructure. He may be giving you Reliance Infocomm but he would retain RCIL. And without this optic fiber backbone Infocomm is worth nothing.
I hope you will give a thought to my offer.
Regards,
Neeraj Gutgutia
neerajgutgutia@yahoo.co.in
According to news in certain section of the media, Mr. Mukesh Ambani has agreed to take RIL and give you Reliance Infocomm and Reliance Energy. If that's true I suggest you accept the offer before he changes his mind.
I offer myself for the post of Managing Director of Reliance Infocomm and promise to make it more valuable than Reliance Industries Ltd. in flat two years.
Donot doubt me. Just to prove my point - Bharti with its customer base of around 1 crore customers is valued at about Rs. 35000 crores. And the best future projections for the company would at the best suggest few crore customers more...lets say 5 crores by 2010. Reliance Infocomm has about the same number of customers today i.e. 1 crore and is expected to grow their mobile telephony market at the same pace as that of Bharti. But the difference is that BY 2010 VOICE WILL CONTRIBUTE ONLY 10% OF INFOCOMM's TOTAL REVENUE. Which means, Reliance Infocomm's mobile business would be as big as Bharti and it should be valued as much for its mobile business. But what need to be considered is the rest 90% of Reliance Infocomm business. Another 10% would be contributed by broadband, video on demand, cable TV, video conferencing etc. Another 10% would come from broadcasting and media related activities.
Revenue sources that most people are right now not able to imagine is revenue like from Revenue from Banking system for leasing of bandwidth for Real Time Gross Settlement (RTGS), ATM connectivity, revenue from bandwidth leasing for e-governance, for national network of camera at public places etc. And mind you unlike the voice business in most of these businesses Reliance would have a virtual monopoly.
Infocomm's real strength is its National backbone of optic fiber. Nobody had laid that on the scale at which Reliance had laid and hence would not be able to meet the bandwidth requirement of nation for services other than telecom. Reliance had the foresight to put in 12 ducts while others were investing in one or two. Nobody can now replicate this infrastructure as Reliance already has first mover advantage and has enough capacity to make and additional investment in optic fiber capacity unviable.
All Reliance Infocomm need to do is to invest in the last mile. Connect as many villages as possible in the next 12 months. If Reliance Infocomm can live upto its pledge of reaching 5700 towns and 4 lakh villages by the year-end, it would become invincible. Organizations like RBI, State government, police department etc. Everybody would have no choice but to come to Reliance for bandwidth. Imagine the power Infocomm can command.
Based on the above estimate if 10% future revenue gives a valuation of Rs. 35000 crores, Reliance Infocomm can be easily worth 350000 crores by 2010!!! In 2 year time I promise a valuation of 1,75,000 crores. Yes, to get to that point lot of hard work in terms of setting up the last mile infrastructure is required. At the same time VISION is very important. The limit of this marvelous infrastructure Reliance has created is only that of vision.
And here is where I come in. Excuse me if I sound immodest. But believe me, last eight years of 'Reliance Stalking' has helped me develop capability to dream at the same wavelength at which Mukesh Ambani has been dreaming for this project. Give me opportunity to interact with you, one-to-one for 30 minutes, I promise I will convince you.
If Mukesh is really offering you Reliance Infocomm I suggest you grab it and run. But just make sure that he is also giving up the optic fiber backbone and not just the Mobile business. I just can’t imagine Mukesh would give up this goldmine. I doubt Reliance Communication & Infrastructure Ltd. (RCIL) and not Reliance Infocomm owns that optic fiber infrastructure. He may be giving you Reliance Infocomm but he would retain RCIL. And without this optic fiber backbone Infocomm is worth nothing.
I hope you will give a thought to my offer.
Regards,
Neeraj Gutgutia
neerajgutgutia@yahoo.co.in
4 comments:
Hi neeraj ,
I read your blogger today (open letter to Anil Ambani). I would
like to draw your attention to few things which I think you have missed.
About the business of reliance infocom I think
your are right that in the coming years their bandwidth business will
surpass their telephony business. But I doubt the pace at which you are
expecting this business to grow. I don’t think reliance infocom will
become as large as you are expecting in the next five years. The businesses
like broadband, video on demand and video conferencing will not find
enough subscribers in just five years. Just think how many net
subscribers we have in India. As far as I know there are only 2-3% computer
owners are there in India. Even you think the businessmen will use these
services, I would say just think how many small businessmen are
tech-savvy. I think a large chunk don’t even know what these things are. For
example, consider the businessmen doing businesses in chandni chowk, karol
bagh or ajadpur in Delhi. These people do businesses in millions and
hardly use any modern technology for doing so. Forget about chandni
chowk, just consider the situation of Nehru place which is considered to be
the largest computer hardware market in Asia. You will hardly find
anybody having a internet connection there. States like Bihar, jharkhand,
Rajasthan. U.P. will provide very few customers to this company.
Now, if you are counting on the Indian government or
state governments to become infocom customers, just think twice. Except
for banks, no other sector will even consider going so high-tech so soon,
as we all know how our governments functions in India. Even if they do,
I think they will prefer BSNL over reliance. You have mentioned in your
blog that infocom OFCs are covering 5700 villages all over India. I
don’t think this will give any financial gains to the company for at least
15-20 years or even more.
Just consider the fortune spent to lay
60,000 km of optical fibre. I think, it will take more than five years for
the company to even cover their expenses.
The only way reliance can capture the market is the
way they did in telephony business .i.e. to provide the services dirt
cheap to anybody or everybody. But as we all know this company is still
waiting for a profitable quarterly result. I agree with you that this
company is doing a great business and will attain great heights in future
but I think it will take far more time than five year to reach to the
level you are looking for.
At last, I want to add that as far as I know about
reliance industries, these two brothers really knows how to do business
in India. If they settle their differences reliance is the best stock to
hold in stock market and I am doing so.
Vishal Bharti
Overconfidence is more deadlier than cynide....infocom has nothing to offer...with cdma almost outdated..wcdma on the uprise...what did you think in may to make a point that you would make this mircale in FLAT 2 YARS...!!!
hi,
I believe its not about CDMA GSM and WCDMA alone. As i have mentioned in my blogs regularly the biggest USP of Reliance Infocomm is its last mile optic fibre infrastructure. I stick to my words - A revolution can be created in 2 years flat!!
Neeraj Gutgutia
Vishal bhai I would like to correct in one point Reliance Infomm is oding very good businees in bihar jharkand circle as there are only 3 main operators airtel,bsnl,rim. Now in all the towers of rim RTL(SMART) will put its antennaes and has already starting business .This is the pace of reliance .U will be very mistaken if u under estimate the potential of bihar or jharkand (Just go to Godda in jharkand and find out how many mobiles were sold in the first month of launch.
Man really come out of delhi ,go to the villages and find out the potential
I have seeen places where people have money own mines but there r no towers .
U may not be surprised to hear when u listen that companies like dish net and idea cellular have tied up to built towers together
and
tata indicom and hutch have tied hands to do the ofc laying job together but probably it has falen thru
NOW do u get the financial might of reliance and bsnl and airtel
and never under estimate the financial mightinthe rural area
Where banks and financial institutions r using the broad band services of reliance
from
some one who planned the location of towers in rural states and have seem mobiles ring in the remote parts in bihar and jharkand
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