Six-seven firms interested in Power Grid's towers

Six to seven companies are likely to bid for state-owned Power Grid’s tender to lease out its tower infrastructure.

“Six-seven firms have shown interest in bidding, including Reliance Infratel, Indus Towers, GTL Infrastructure and Viom Networks, among others. However, we will get to know the exact bids on November 29, which is the last day for submission of bids,” a senior company official told Business Standard.

The country’s largest transmission utility has invited bids for leasing out its about 12,000 towers in four states – Jammu & Kashmir, Haryana, Punjab and Himachal Pradesh – to independent tower companies or mobile service providers. Power Grid has about 150,000 towers across the country and about 70 per cent of these are in semi-urban and rural areas.

After submission of bids, it is expected that the final award to the companies will take two-three months. The official said the company would lease out its towers in the rest of the country in the next financial year. In the first half of this year, the company received an in-principle approval from its board of directors for venturing into this new business stream of leasing out towers.

The company expects revenues from the telecom business to grow to Rs 350-400 crore, from Rs 150 crore at present, in the next four-five years. With the Indian telecom industry adding 14-15 million subscribers a month and the entry of new operators, companies are looking to share infrastructure and save costs. A telecom tower costs about Rs 10-15 lakh.

Power Grid diversified into the telecom sector about four years ago. It offers end-to-end leasing of bandwidth to telecom operators through its overhead transmission infrastructure. It has a fibre-optic network of 20,000 kilometres (km). By the end of the 11th Plan (2012), the company is likely to have a network length of close to 30,000 km. It has Bharat Sanchar Nigam, Tata Teleservices, Reliance Communications and Bharti Airtel among its customers.

The company has infrastructure in remote areas, including the north-east region, Jammu & Kashmir and Himachal Pradesh. It holds Infrastructure Provider-I (IP-I) and Internet Service Provider Category-A (ISP-A) licences. In July 2006, it acquired a National Long Distance licence, which enables it to offer services to non-licensed service providers such as entities in the corporate, government and defence sectors.