Advertisment

V&D Top 10 Company review - Sterlite Industries

author-image
CIOL Bureau
New Update

It was a good year for the numero uno

in the telecom cable industry. Sterlite Industries (India) Ltd posted a growth of 22

percent to clock revenues of Rs 562 crore for 1998-99 compared to Rs 459.28 crore in

1997-98. The country’s largest manufacturer of Jelly Filled Telecom Cables (JFTC)

grew by more than the cable industry growth rate last year, which was around 15 percent.

Sterlite also became the leading supplier of Optical Fiber Telecom Cables (OFTC).

Advertisment
width="30%">

CEO: Anil Agarwal



Year Of Start-up: 1975


Area Of Operation: Telecom cables, optical fibre cables


Address: Dhanraj Mahal, 5th Floor, CSM Road, Apollo Bunder, Mumbai -
400 039



Tel.: 022-2855551/2836474


Fax: 022-2836474


Website: www.sterlite.com




Advertisment


JFTC output increased by over 75 percent

while that of OFTC increased by over 100 percent for Sterlite. The supply of JFTC took

a

leap to 57.79 lckm in the nine months ending March 1999, as against 32.88 lckm for the

corresponding period in 1998. In the case of OFTC, the sales of the first nine months were

around 85,281 fkm as compared to 52,000 fkm of the previous year. The company also

achieved the highest production of optical fibre in the country. Last year, the sales of

optical fibre increased to 132,718 kilometre from 89,270, an increase of 49 percent.

The company claims to hold a marketshare of

16 percent in JFTC and 29 percent in OFTC. It is also the largest supplier of OFTC to the

Indian Railways with an installed productioncapacity 350,000 fkm. Further, it has been

able to improve the margins, which were under pressure in the recent past, due to

operational efficiencies, increased productivity and also reduction in key raw material

prices.

Advertisment

During the current fiscal, the market size

for JFTC in the country is estimated to increase to 510 lckm from the previous year’s

figure of 388 lckm and in revenue terms this would mean a whopping Rs 3,300

crore. The DoT

has projected a requirement for over 450 lckm for the year 1999-2000 at a value of Rs

3,100 crore. Of this, the tender for 366 lckm has already opened in March 1999. Besides,

MTNL is expected to announce tender for about 55 lckm shortly. Both the DoT and MTNL are

expected to purchase about 500-510 lckm of JFTC during the current fiscal which means a

volume growth of about 25 percent. Sterlite, with a production capacity of 100

lckm, would

be the largest beneficiary of this spurt in demand. The company, along with its subsidiary

arm, expects to get over 89 lckm order in 1999-2000, highest in the industry.

As for optical fibre, the DoT has doubled

the tender size for 1999-2000 to over 70,000 kilometre. In revenue terms this would be

around Rs 350 crore. With the advantage of backward integration into optical

fibre,

Sterlite is expecting an order for about 22,000 kilometre, which will be over two times

the orders received during the last fiscal.

Given the advantages of low capital cost,

operational cost and location in backward area, Sterlite should be able to maintain its

marketshare in JFTC taking into account the enhanced market size. The company enjoys

similar advantages in OFTC too. In this business, it is learnt to have secured some major

export orders from South America and intends to export 30 percent of its total

production. 

The Top 10
1 6
2 7
3 8
4 9
5 10
tech-news