Analyst Meet Q2 & H1 FY09 v5

Analyst MeetQ2 & H1 FY09

Tata Teleservices (Maharashtra) Limited

10 November 2008

Disclaimer

Certain statements in this release concerning our Company objectives, future prospects, expectations may be forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. Tata Teleservices (Maharashtra) Limited may, from time to time, make additional written and oral forward looking statements, including our reports to shareholders. The Company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the company.

Market Overview

India

Population as on July 2007 (Mln)Population as on July 2007 (Mln) 1129.81129.8 99.899.8 1818

Maharashtra(excl. Mumbai) Mumbai

Source: Department of Economics & Statistics, Tata Services Ltd. & TRAI Subscriber Report

Wireless TeledensityWireless Teledensity 28%28% 25%25% 88%88%

H1 09 subscriber growth over H2 08H1 09 subscriber growth over H2 08 21%21% 19%19% 16%16%

Wireless Base as on Sep 2008 (Mln)Wireless Base as on Sep 2008 (Mln) 315.4315.4 24.724.7 15.815.8

H1 09 TTML subscriber growth over H2 08

H1 09 TTML subscriber growth over H2 08 24%24% 18%18%

13.1%

2.6%

19.7%

3.2%

16.1%

23.0%

16.4%

6.0%

15.5%

3.9%

27.9%12.4%

22.7%

17.5%

8.6%

4.6%

9.0%

23.0%

23.4%

14.4%

17.0%

H1 09 Wireless Incremental Market ShareMumbaiMumbai ROMROM

TTMLTTML

11

22 44 11

22

33

11

2233

33

Vodafone

Reliance

BPL

MTNL

Airtel

Idea

Idea

Vodafone Airtel

Reliance

BSNL

Idea

Vodafone Airtel

BSNL

MTNL

BPL

Reliance

Tata IndicomTata Indicom

Tata Indicom

8.3%

15.1%5.2%

18.5%

4.1%

14.1%

18.3%

16.5%

19.4%

24.3%

14.3%

13.6%

14.6%

13.8%

16.5%

10.5%

13.4%20.6%

25.1%

13.2%

0.6%

H1 09 Wireless EOP Market ShareMumbaiMumbai ROMROM

TTMLTTML

44 55

11

22

33

11

22

33

4455

11 22

33

Vodafone

Reliance

BPL

Tata Indicom

MTNL

Airtel

Idea

Idea

Vodafone Airtel

Reliance

BSNL

Idea

VodafoneAirtel

BSNL

MTNL

BPL

Reliance

Tata Indicom

Tata Indicom(FY 08 EOP MS = 13.5%)

Reliance30.4%

Bharti19.1%

Tata Indicom50.5%

Reliance20.6%

Bharti29.8%

Tata Indicom49.7%

H1 09 Wireline EOP Market Share

MumbaiMumbai

ROMROM

(Only Private players)(Only Private players)

(354K)(354K)

(106K)(106K)

Business Priorities

Optimize Costs & Enhance MarginsOptimize Costs & Enhance Margins33

Build Indicom Brand & Focus on InnovationBuild Indicom Brand & Focus on Innovation11

Enhance Network RolloutEnhance Network Rollout22

Focus on Customer ServiceFocus on Customer Service44

Business Priorities


Schemes & Offers

Value Added Services

Devices

Concerts & Events

TVCs & Radio

Build Indicom Brand & Focus on Innovation

Highlights of Let’s Rock Plan

Launched in June end

3 years validity

Special tariffs at night after 9pm

Accounts for over 23% of sales since launch

Schemes & OffersSchemes & OffersLet’s Rock


Schemes & OffersSchemes & OffersTata-to-all Rs. 475 Recharge


Launched in September 08Feature enhanced to connect upto 29 users at one time Major marketing campaign planned

Value Added ServicesValue Added Services



VAS + Data Revenues as a % of Wireless Revenue increased from 11.8% to 13.4%, Q408 to Q209

VAS + Data Revenues as a % of Wireless Revenue increased from 11.8% to 13.4%, Q408 to Q209

TTML V-Data EOP Subscriber GrowthTTML V-Data EOP Subscriber Growth

Q4FY08 Q1FY09 Q2FY090

>150K>150K

100

150

50


DevicesDevices

Plug2Surf with 1GB MemoryNovatium – Nova NetPC


DevicesDevices

Blackberry world editionWalky-Talky


DevicesDevices

Samsung, Haier & ZTE Handset Offerings


Concerts & EventsConcerts & Events


TVCs & RadioTVCs & Radio

Go One (TVC)Go One (TVC) Shree Ganesha (TVC)Shree Ganesha (TVC)

Business Priorities





Enhance Network Rollout

Hindustan Times Business Standard Loksatta

1168 12421319

1538

1757

2050

500700

9001100

13001500

17001900

21002300

Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09

367415 449

565

679

812

0100200300400500600700800900

Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09


EOP Town CoverageEOP Town Coverage

EOP Wireless Cell SitesEOP Wireless Cell Sites

512512

247247


Optical fiber backbone of more than 6500 Kms at end of H1

Wireline network in Mumbai upgraded to NGN MPLS network

Mumbai network successfully swapped in August ‘08

247 towns and 512 BTSs rolled out, taking the total to 812 towns and 2050 BTSs; best ever wireless rollout performance in any half yearly span

Business Priorities





Optimize Costs & Enhance Margins

Tower assets divested to 21st Century Infra Tele Ltd, with effect from 30th

September

Infra sharing arrangements with operators

Reduced reliance on free on-net calling; reduced free internet access on broadband plans

Recharge commission structure brought more in line with the market

Business Priorities





Focus on Customer Service

Lowest POI congestion among all operators as per TRAI report

Loyalty programs for customers (e.g. birthday greetings, movie tickets, privileged help-desk support, instrument health-check)

Acterna – Real-time monitoring of fiber cuts in Mumbai to improve restoration time

Automatic Switch-over of Optical Network (ASON) for multiple path redundancy for Mumbai

Q2 & H1 FY09 Performance

TTML EOP Subscribers & Market Share

EOP Subscribers in millionsEOP Subscribers in millions 3.073.07 5.085.08

Source: TRAI Subscriber Report

Wireless Incremental Market Share

Wireless Incremental Market Share 15.2%15.2% 15.8%15.8%

Wireless EOP Market ShareWireless EOP Market Share 12.1%12.1% 13.5%13.5%

FY06 FY07 FY08

EOP Subscriber Base (Mn)

H1FY090

3.073.07

1.81.8

6.156.15

5.085.08

1.81.8

12.5%12.5%

10.5%10.5%

Year FY06 FY07 FY08

6.156.15

16.4%16.4%

14.1%14.1%

H1 FY09

SCORECARD Q2 FY08 Vs Q2 FY09

Total Revenue (Rs.Crs.)Total Revenue (Rs.Crs.)

EBITDA (Rs.Crs.)EBITDA (Rs.Crs.)

EBITDA Margin % EBITDA Margin %

Cash Profit (Rs.Crs.)Cash Profit (Rs.Crs.)

Q2 FY08Actual

EOP Subscribers (Nos. in lacs)EOP Subscribers (Nos. in lacs)

PAT (Rs.Crs.)PAT (Rs.Crs.)

Q2 FY09Actual

429429

106106

25%25%

5555

41.341.3

(49)(49)

121%121%

152%152%

124%124%

124%124%

%Performance

149%149%

104%104%

Cash Profit (Rs.Crs.) (excl. Forex Loss/Gain)Cash Profit (Rs.Crs.) (excl. Forex Loss/Gain) 6363 162%162%

518518

161161

31%31%

6868

61.5461.54

(47)(47)

102102

SCORECARD H1 FY08 Vs H1 FY09

Total Revenue (Rs.Crs.)Total Revenue (Rs.Crs.)

EBITDA (Rs.Crs.)EBITDA (Rs.Crs.)

EBITDA Margin % EBITDA Margin %

Cash Profit (Rs.Crs.)Cash Profit (Rs.Crs.)

PAT (Rs.Crs.)PAT (Rs.Crs.)

10231023

316316

31%31%

148148

H1 FY09Actual

(82)(82)

Cash Profit (Rs.Crs.) (excl. Forex Loss)Cash Profit (Rs.Crs.) (excl. Forex Loss) 202202

EOP Subscribers (Nos. in lacs)EOP Subscribers (Nos. in lacs) 61.5461.54

H1 FY08Actual

839839

207207

25%25%

131131

41.341.3

(78)(78)

123123

Quarterly Performance

EOP Subscriber Base (`000)

2,350 2,711 3,0743,478

4,1275,079

5,617

2,104

6,154

4,696

600

1,600

2,600

3,600

4,600

5,600

6,600

Q1F

Y07

Q2F

Y07

Q3F

Y07

Q4F

Y07

Q1F

Y08

Q2F

Y08

Q3F

Y08

Q4F

Y08

Q1F

Y09

Q2F

Y09

EOP Subscriber Base (`000)

2,350 2,711 3,0743,478

4,1275,079

5,617

2,104

6,154

4,696

600

1,600

2,600

3,600

4,600

5,600

6,600

Q1F

Y07

Q2F

Y07

Q3F

Y07

Q4F

Y07

Q1F

Y08

Q2F

Y08

Q3F

Y08

Q4F

Y08

Q1F

Y09

Q2F

Y09

Revenue (Rs.Cr.)

342367 389 409 429

491 505

324

518460

150

250

350

450

550

Q1F

Y07

Q2F

Y07

Q3F

Y07

Q4F

Y07

Q1F

Y08

Q2F

Y08

Q3F

Y08

Q4F

Y08

Q1F

Y09

Q2F

Y09

Operational Cost per Sub (Rs.pm)

415374 337 314 283

233 218250202

449

150

250

350

450

550

Q1F

Y07

Q2F

Y07

Q3F

Y07

Q4F

Y07

Q1F

Y08

Q2F

Y08

Q3F

Y08

Q4F

Y08

Q1F

Y09

Q2F

Y09

EBITDA (Rs.Cr.)

8397 106

150 155

34

6458

161

128

0

40

80

120

160

200

Q1F

Y07

Q2F

Y07

Q3F

Y07

Q4F

Y07

Q1F

Y08

Q2F

Y08

Q3F

Y08

Q4F

Y08

Q1F

Y09

Q2F

Y09

Crossed 500 Crstwo quarters in a

row

Quarterly Performance

EBITDA Margin (%)

19%23% 25% 25%

31% 31% 31%

18%

25%28%

0%

7%

14%

21%

28%

35%

Q1F

Y07

Q2F

Y07

Q3F

Y07

Q4F

Y07

Q1F

Y08

Q2F

Y08

Q3F

Y08

Q4F

Y08

Q1F

Y09

Q2F

Y09

PAT(Rs.Cr.)

(93)

(28)

(49)

(35)(21)(27)

(47)

(112)

(46)(59)

(120)

(100)

(80)

(60)

(40)

(20)

-

Q1F

Y07

Q2F

Y07

Q3F

Y07

Q4F

Y07

Q1F

Y08

Q2F

Y08

Q3F

Y08

Q4F

Y08

Q1F

Y09

Q2F

Y09

EBIT (Rs. Cr)

215

3341 46

(18)

(52)(66)

(2) (3)

(80)

(60)

(40)

(20)

-

20

40

60

Q1

07

Q2

07

Q3

07

Q4

07

Q1

08

Q2

08

Q3

08

Q4

08

Q1

09

Q2

09

Key Parameters

Particulars Units Year Ended Quarter Ended Sep-07 Dec-07 Mar-08 FY-08 Jun-08 Sep-08

Wireless ServicesSubscribers Base Nos. '000 3,794 4,333 4,683 4,683 5,190 5,698 Prepaid Subscribers as a % of EOP Subscribers % 85% 86% 86% 86% 87% 88%Wireless Subscribers Market Share % 13.6% 13.9% 13.5% 13.5% 14.0% 14.1%Average Revenue per User Rs. per month 265 254 254 268 232 210 Avg. MOU per User # Min. per month 356 313 302 338 288 260 Rate per Minute Rs. 0.74 0.81 0.84 0.79 0.81 0.81 Postpaid Voluntary Churn % per month 0.8% 0.7% 1.1% 0.9% 0.8% 0.6%Postpaid Company Initiated Churn % per month 2.3% 1.7% 1.4% 1.9% 1.2% 2.5%Prepaid Churn % per month 1.1% 1.8% 2.2% 1.6% 0.8% 0.8%VAS + Data Revenues as a % of Wireless Revenue % 9.3% 10.4% 11.8% 10.1% 12.3% 13.4%

Wireline ServicesCustomers Nos. '000 333 363 396 396 427 456 ARPU Rs. per month 1,411 1,284 1,269 1,324 1,260 1,275

# Only Voice & outgoing T2T MOUs considered

Quarter Ended

* Q4-08 revenues & ARPU include USO Subsidy for 3 quarters; Q1-09 revenues include USO Subsidy for 2 quarters; Q2-09 has upfront subsidy, accounting change from 01.04.2008

Other Details

Particulars Units Q1-09 Q2-09Wireless ServicesMinutes on Network Mn Min 4,258 4,241 Census Towns Nos. 295 311 Non-Census Towns and Villages Nos. 7731 7,804 Population Coverage Nos. lacs 608 623 Network Sites Nos. 1757 2,050 Optic Fibre Network Km 6536 6,580

21st Century Infra Tele Ltd.Total Towers Nos. - 1,294 Ground Based Towers Nos. - 381 Roof Top Towers and Others Nos. - 913

Balance Sheet dataGross Debt Rs. Cr 2,781 2,894 Net Debt Rs. Cr 2,753 2,856 Gross Block (including Capital WIP) * Rs. Cr 4,620 4,456

* Rs. 268 Cr fully depreciated assets written off and removed from Gross Block of assets in Q1-09; TDMA assets written off from Gross Block in FY-08.

* Passive Infrastructure assets hived off wef 30th Sep 2008.

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

0

3,000

6,000

9,000

12,000

15,000

18,000

-

5

10

15

20

25

30

35

40

Market Capitalization & Share Price

Source: BSE

(Fig. in Rs. Crs)

28.4528.45

37.6037.60

21.7021.70(Fig. in Rs.)

TTML Share Price TrendTTML Share Price Trend

5387.195387.197133.447133.44

4116.904116.90

Market Capitalization TrendMarket Capitalization Trend

15626.6215626.62

17600.1217600.12

12860.4312860.43

BSE Index TrendBSE Index Trend(Fig. in Rs.)

H1 Highlights – in Ending

TTML achieved incremental wireless market share of 16.4%; ranked number three in subscriber additions in TTML’s geography

TTML’s Maharashtra circle crossed 3 million subscribers; Mumbai crossed 2 million subscribers; overall TTML crossed 6 million subscribers

Half yearly revenues crossed Rs. 1000 Crs. for the first time

EBITDA margin maintained over 30% for the past three quarters and H1

Investments being made to create Next Generation Networks (NGN)

Tower assets divested to 21st Century Infra Tele Ltd, with effect from 30th September

Mumbai network swapped as per schedule

H1 Highlights – in Ending

High visibility created for the Tata Indicom brand

Increased focus on market segmentation, with products such as Let’s Rock targeted at students

New revenue streams being created through product and service innovation

Thank You

Analyst Meet Q2 & H1 FY09 v5

Documents

Transcript of Analyst Meet Q2 & H1 FY09 v5