Ready for 3G and WiMax equipment manufacturing

ITI's revival strategy is to harness the vast potential in the areas of wireless and personal communications and broadening strategic relationship, particularly with customers like BSNL, MTNL and Defence, says  Pritam Singh, chairman and managing director, ITI, in interaction with  Cybermedia's Malovika Rao

Pritam Singh: What are the reasons for a marginal 5% growth this year, after achieving an impressive 26% growth the previous fiscal?

Cybermedia: We had an impressive order value of over Rs 2,400 crore in hand but we could not deliver all of it on time. The first quarter of the fiscal year 2006-07 was non-productive due to internal policy issues for handling the orders received from BSNL and MTNL. Now we have solved those productivity issues. We are also facing pricing pressure. The prices have fallen steeply by 40-60% over the period, and with imported technology, our margins are severely affected. Despite these challenges, we were able to keep our losses down compared to the previous fiscal.

PS: What is your revival plan to come out of the red?

Cm: The revival strategy is to harness the vast potential in the areas of wireless and personal communications and broadening our strategic relationship, particularly with customers like BSNL, MTNL and Defence. For our social obligations we are expecting some financial assistance. We cannot improve our bottom-line unless we are aggressive. We have taken measures to improve our internal systems by establishing the information security management system and access control policy. This company will go very well if there is mutual respect and focus on customer.

PS: What are the major focus areas as part of your diversification strategy?

Cm: Our main thrust continues to be turnkey projects. However, we are keen on taking up diverse projects beyond turnkey-like IT networking solutions, which leverages the convergence platform for communication. Special focus is on IT networking solutions during this year that will increase my business beyond turnkey. ITI is one of the four vendors to take up the National ID Project.

PS: What are your plans for emerging technologies, especially in the wireless domain?

Cm: We are ready for 3G, and hope to get significant orders for 3G equipment manufacturing from BSNL and MTNL this fiscal. With regards to WiMax, we have signed an MoU with Alcatel in April this year. Alive to the emerging techno-commercial trends, ITI has sought several technology alliances from leaders in the field. Major products for which pacts have been concluded are ADSL, WiMax, and GPON.

PS: How do you plan to grow in the current fiscal despite the pricing pressure?

Cm: We feel that with imported technology and decreasing prices, our margins continue to suffer. We are trying to increase the level of integration in manufacturing. Over and above procuring or importing certain material, if ITI can manufacture, we shall be saving considerable cost and increase margins. Efforts are on to indigenize inputs for GSM in order to minimize the procurement costs. This will easily contribute about 10% to the overall revenue.

The current fiscal (FY '07-08) has begun on an optimistic note with orders of Rs 1,266 crore in hand and we are confident of meeting the MOU target of Rs 4,770 crore. We are confident that this will see us out of the red by 2009-10. I would like to finish my tenure (ending October 2007) on a note where the company is looking at better performance and turnover.