Videsh Sanchar Nigam Limited (VSNL)
registered a strong operational and financial performance in 1998-99. The company had a
rapid growth in traffic and increased the number of value-added services in its portfolio.
However, the growth in revenues
Amitabh Kumar
Year Of Start-up: 1986
Area Of Operation: Inernational telecom services, value added services
Address: Videsh Sanchar Bhavan, MG Road, Fort, Mumbai-400001
Tel: 022-2624020
Fax: 022-2624466
Web: www.vsnl.net.in
is slightly lower than the growth in traffic because of
declining account rates. The silver lining was a negligible increase in network cost
despite the steep rise in total traffic.
Turnover for the last fiscal increased by
11.7 percent to Rs 7189.60 crore from Rs 6436.10 crore in 1997-98. The net profits jumped
38 percent. The traffic increased 15 percent to 1,935million paid-minutes. The number of
telephone circuits operated increased to 17,922 as on 31 March 1999, up by 16 percent.
VSNL’s non-telephony revenues increased 78 percent to Rs 477.33 crore. Total
telephony revenue was Rs 2,045 crore. Revenue from the telephone traffic grew at 8.9
percent while the total traffic revenue was up by 11.2 percent. Low growth in telephone
revenue was because of settlement rate cuts with international carriers.
Value-added services soared 208 percent to
Rs 173.3 crore in spite of reduction in tariffs. The Internet subscriber base stood at
2,30,000 on 31 March 1999 compared 90,042 as on 31 March 1998, while the Internet leased
lines increased to 463. The company has recently added a number of features for its
Internet services, including national and global roaming, multi-lingual Internet facility
and 25-hour accounts. It has also upgraded all shell accounts to TCP/IP accounts. The
total leased line revenues posted a growth of 30.7 percent to Rs 246.6 crore and the
number of customers has increased to 658 from 603 in the previous year.
During 1998-99, VSNL incurred a total
capital expenditure of Rs 761.62 crore. It has earmarked Rs 5,000 crore for the next three
years. The company plans to lay more thrust on data networking and IT enabled services in
the current year. It has already commissioned new earth station facilities at
Chandigarh, Goa, Indore, Coimbatore, Bangalore and Hyderabad to increase the Points of Presence. To
cater to the increasing Internet traffic, an advanced Internet Central Control Facility
has already been commissioned to provide high-quality services as well as statistical
information to the ISPs.
VSNL’s new earth stations, including
two standard A at Arvi and Chennai, are expected to go on stream shortly. This will add to
the network capability of the company enabling it to operate on multiple satellites. The
laying of the SEA-ME-WE3 cable is also complete, and would be technically commissioned
this month. The last fiscal saw VSNL acquire a stake in New Skies Satellites NV, which is
spun off from the international satellite consortium INTELSAT and augmented its investment
in ICO Global Communications to $150 million.
VSNL is gearing up to meet the challenges
to be thrown up when international telecom services are opened to the private sector.
Expansion and diversification are the key words for the PSU in the coming years.
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