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Tata Com plans $250-mn capex over next 2 yrs

Last Updated: Tuesday, February 14, 2012 - 00:07

Mumbai: Submarine cable network operator and bulk data traffic carrier Tata Communications Monday said that it plans to spend USD 200-250 million as capital expenditure over the next two fiscal years, to expand its infrastructure and also narrow losses.
"We also plan to infuse USD 500-600 million of capital into its business by raising equity over the next three years. But this will not be to buy out the government's 26 percent stake in us but to fund organic expansion plans," Tata Communications MD & CEO Vinod Kumar said here.
The company expects the issue regarding the sale of excess land reserves held by the erstwhile Videsh Sanchar Nigam (VSNL) in which the Tata Group acquired a controlling stake to be resolved in the next 12 months, he said.
When specifically asked when Tata Com's subsidiary Neotel which serves the South African converged services market will turn PBT positive, he said this could be expected to happen over the next six quarters.
"Neotel turned EBITDA positive last year. There will be some more investments. There will be capex spending for another 12 to 18 months," he said.
The company sees growth coming from emerging markets in areas like shifting of applications to cloud, video collaboration tools, 3G and LTE as well as industry specific applications, he added.
The company said it is not worried about commoditization of voice traffic.
"In voice, we are working to take the take the traffic on a long term basis through outsourcing arrangements for several years. So there is no price pressure. We also know how to manage a commoditised voice business," senior vice president for corporate strategy & communications Srinivasa Addepalli said.


First Published: Tuesday, February 14, 2012 - 00:01
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