I am presenting 36th Annual Report of your Company for the financial year 2013-14 along with highlights of achievements of the company, the Audited Annual Accounts, Directors' Report, Independent Auditor's Report and NIL Comments of C&AG. The copies of the same have already been circulated to you. With your kind permission, I take them as read.
At present, the economy of India is the tenth-largest in the world by nominal GDP and the third-largest by purchasing power parity. The country is one of the member of G-20 major economies, a member of BRICS and a developing economy that is among the top 20 global traders according to the WTO. The economy grew by Sub 5 per cent in 2013-14. Government expects growth in the current fiscal year to be between 5.4 and 5.9 per cent. Before I brief you about the performance of your company, I would like to touch upon the economic environment. The Indian Economy is looking forward to higher growth due to moderate recovery of global economy, cooling off crude oil prices, revival of investors' confidence, increase in sensex and good Governance. Therefore, India has an opportunity to achieve faster, and more inclusive growth.
Globalisation has made telecommunication an integral part of the infrastructure of the Indian economy. The Telecom Sector in India has developed as a result of progressive regulatory regime, and is showcasing tremendous growth, as well as potential. Being recognized as one of the most lucrative markets globally, the Indian telecom sector has not only shown signs of profitability but also contributed significantly to the nation's economy.
The telecommunications sector in India is growing rapidly, and due to its potential, there have been a number of investments in the recent past. The Government of India has taken several initiatives to boost the telecommunications sector in India. DoT is promoting a vision of 'green telecom' wherein it plans to convert 50 per cent of urban and 30 per cent of rural cell sites to renewable energy. Various policy initiatives by Government of India have led to a complete transformation of the industry in the last decade. It has achieved a phenomenal growth during the last few years and is poised to grow further. However, cut-throat competition and intense tariff wars have had a negative impact on the revenues of players. Despite these challenges, the Indian telecom industry is expected to thrive because of the immense potential in terms of new users. India is one of the most-attractive telecom markets. The government is keen on developing rural telecom infrastructure, and is encouraging the roll out next generation or 4G services in the country. Operators are on an expansion mode, and are investing heavily in telecom infrastructure. Foreign telecom companies are acquiring considerable stakes in Indian companies. Increasing young population and their increasing spending power, the government's thrust on increasing rural telecom coverage, favourable investment climate and positive reforms will ensure that India's high potential is indeed realised.
Telecom Industry in the country is undergoing a process of transformation into the Next Generation Networks, employing an extensive system of modern network elements such as digital telephone exchanges, mobile switching centres, media gateways and signalling gateways at the core, interconnected by a wide variety of transmission systems using fibre-optics or Microwave radio relay networks, 3G, 4G etc.
With a lot of emphasis on Digital India by the new Government including the Financial inclusion schemes like 'Pradhanmantri Jan Dhan Yojna' cleaning of Ganga, e-Governance etc. there are new opportunities in the field of Information Technology. With its vast experience in this domain, TCIL intends to cash on these opportunities. TCIL has continuously remained a dynamic entity by entering into new areas of operations, and deploying new technologies and has been established as a premier organisation in providing Multi - disciplinary Services over the years.
Your Directors recommend to pay a Dividend of 7% of the Profit after Tax for Financial Year 2013-14 subject to the approval of the Members at the Annual General Meeting.
During the year under review, your Company achieved a Turnover of Rs. 8165 Million as compared to the previous year Turnover of Rs. 7082 Million. The Profit after Tax of your Company was Rs.147 Million as against previous year's figure of Rs. 158 Million.
During the course of journey, we have achieved many milestones and scaled new heights. A brief overview of the multiple projects executed by TCIL during the year is as follows :
Pan African e-Network Project
Forty Eight member countries of the African Union are a part of the project, which aims at providing Tele-Education, Tele-Medicine services from Indian institutions to the African countries and VVIP connectivity for video conferencing and VoIP services among the Heads of the States. Presently, more than 15,083 students from 38 countries are registered with these 5-universities of India for taking education in 23 programmes. More than 4,456 sessions have been conducted from the Universities in above programmes. The project initially under operations and management phase upto July 14, 2014, has been extended by Ministry of External Affairs and African Union Commission upto 14th July, 2016. This successful commissioning of such a complex Pan African project has been a feather in the cap of TCIL. It has developed core capabilities in the emerging fields of Tele-education and Tele-medicine and e-Networking within TCIL.
NFS - Defence Tender
Your company participated in the tender for supply, trenching, laying, installation, testing and maintenance of optical fiber cable, PLB duct and accessories for construction of exclusive optical NFS backbone and optical access routes on turnkey basis for Defence network for Package 'A' (in the state of Jammu and Kashmir of the NTP region) and Package 'C' (in the state of Rajasthan, Uttar Pradesh and Uttarakhand). TCIL has been awarded a Purchase Order for Package-C for the total value of Rs. 20.6 Billions including the AMC. This is single biggest order that TCIL has bagged since its inception.
Postal ICT Project
Department of Posts has awarded the project of Supply, installation and maintenance services of Hardware, Peripheral devices, Operating system and connectivity for rural Information and Communication Technology (ICT) solution. The scope of work involves supply, installation and AMC for five years of 130,000 MCDs (Main Computing Devices) along with solar panels and charging units, training to the staff of DoP and other software vendors and setting up of helpdesks at different places across India. Work is spread over entire India, divided into four clusters of North, South, East and West. Total value of work is Rs.13.6 Billions.
Power Sector Projects
TCIL is currently executing 3 turnkey projects for Transmission Corporation of Andhra Pradesh Limited (APTRANSCO) for Survey, Design, Supply, Erection and Commissioning of Optical Power Ground Wire (OPGW), Optical Fibre Cable of ADSS type on 363 kms of high voltage overhead power lines. The projects also include Supply and Commissioning of OLTE, MUX and Switching Equipments.
TCIL has been awarded Optical Power Ground Wire (OPGW) Project in December, 2013 by Power Grid Corporation of India Limited (PGCIL) under Prime Minister's Reconstruction Program for J&K State through International Competitive Bidding Process
Your company is executing DSPT Project for BSNL, a prestigious project of national importance. The Project involved procurement and supply of Digital Satellite Phone Terminals (DSPT) for providing voice and Data services to the population residing in most inaccessible, high security and sensitive areas across India.
TCIL has been awarded the Implementation of the ICT@School Project in Government and Government Aided Higher Secondary Schools across the State of Odisha, for providing Computer Education Services and maintenance of equipment, on Build, Own, Operate and Transfer (BOOT) model by Odisha Knowledge Corporation Ltd on behalf of Department of Mass Education, ODISHA. The project is under execution.
TCIL is executing a prestigious project for Implementation of Computer aided education in 1500 schools of U.P under ICT scheme on BOOT basis awarded by Director of Secondary Education, UP. The project has been successfully commissioned in all the schools & is under operation phase.
The company is executing National Internet Backbone Expansion Project from 5 Million to 10 million. Company is also executing AMC of all phases.
TCIL has been retained as Turnkey Consultant by the Ministry of Micro, Small and Medium Enterprises (MSME), Government of India, since August 2010 for Implementation and monitoring of the operation of 'Udyami Helpline' scheme of the Ministry. Udyami Helpline, a national-level call center, has been setup by Ministry of MSME to provide information to the MSME sector on the single-window concept.
TCIL is executing FTTx project of RJIL for Ghaziabad area.
As a result of empanelment with Power Finance Corporation (PFC) under Restructured Accelerated Power Development and Reforms Programme (R-APDRP), TCIL undertook the consultancy works for 7 Power utilities across India.
TCIL is offering state-of-the-art electronic procurement services based on the e-procurement software, especially designed and developed for Government procurement.
E-Governance is the application of Information and Communication Technology (ICT) for delivering government services, exchange of information communication transactions, integration of various stand-alone systems and services between Government-to-Citizens (G2C), Government-to-Business(G2B), Government to Government (G2G) as well as back office processes and interactions within the entire government frame work. Through the e Governance, the aim is that government services will be made available to the citizens in a convenient, efficient and transparent manner. Over the years, TCIL has successfully executed many e-Governance projects in India. The projects executed by e-Governance division are State Wide Area Network (SWAN), Crime and Criminal Tracking and Network Systems (CCTNS).
TCIL was awarded consultancy assignment in Jan 2014 for Consultancy service for Design and Implementation support for strengthening Last Mile Connectivity of Early Warning Dissemination System. The project pertains to National Cyclone Risk Mitigation Project (NCRMP).
-BBNL had awarded the work of supply of Project Management software for a total value of Rs. 95 Million. Scope of work included supply, installation and hosting of project management software with 400 licenses, provision of 3 PMP manpower and 2 support staff for smooth functioning of the project. The work has been executed successfully and NOFN project is being monitored and controlled through this Project Management software. The manpower services and hosting services are in operation. Annual Software Maintenance Contract (ASMC) is expected for the Project Management software upon completion of Warranty period.
Civil Infrastructure Projects
Civil Division of TCIL is presently operating in more than twelve states of India. Your company is providing comprehensive Project Management Consultancy Services and Architectural Services. The increasing performance and Quality works of civil division has enabled TCIL to book substantial orders from various government departments including works on Nomination Basis and by National Competitive Bidding. In addition to handling a number of Major Buildings and Roads Projects, Civil Division TCIL is also providing Third Party Quality Control Services. Recently TCIL has been awarded a project valuing Rs. 7000 millions by Ministry of Health & Family welfare, Govt. of Meghalaya. The project includes Construction of Hospital, Medical College, boys and girls hostel, nurse hostel residential complex including road, sewerage line, electrification, street lighting etc. Some of the major Building projects in hand includes Construction of Buildings for Battalions and armed forces for Ministry of Home, Govt. of Mizoram with an estimated cost of Rs. 6000 Millions, Project Management Consultancy Services for World HQ Building of Rural Electrification Corporation Limited at Gurgaon, a project registered under GRIHA for obtaining the maximum star rating for Green Buildings valuing Rs. 2800 Millions. TCIL, Civil division is also providing construction services in Healthcare and Medical sector like renovation and expansion of ESIC Hospital at Okhla New Delhi having construction cost of approx 1750 Millions. TCIL, Civil Division has successfully executed the Rs. 900 Millions, Bhawanigarh-Nabha-Gobindgarh Road corridor project of 55Km length on BOT basis in Punjab and the same is operational with Toll collection. TCIL is also executing 2 Road projects on BOT basis in the state of Madhya Pradesh. One is development of 39 Km Lakhnadone-Ghansore Road and another is Strengthening, widening, Maintaining/ operation of 57 Km Bina-Kurwai-Sironj Road. For both projects, separate SPVs have been incorporated. The SPV has received Provisional Completion Certificate for Bina-Kurwai-Sironj and Toll collection has started during April, 2014. The other BOT project at Lakhnadone-Ghansore in under execution.
Modernization of Telecom Seirra Leone
TCIL is executing modernization & expansion of network and infrastructure project in Sierra Leone by Sierra Leone Telecommunications Company Limited (Sierratel). The Contract Value is 30.2 Million US dollars. This project is under line of credit by Government of India through ECOWAS Bank of Investment and Development (EBID).
Apart from SAARC tele-medicine and tele-education e-Network Projects, TCIL has successfully executed several Telecom projects in Nepal.
During 2013-14, TCIL Kuwait has participated in many Telecom and IT tenders of worth INR 13339 Million. Out of this, two tenders worth Rs. 2008 Million have been awarded to TCIL Kuwait, being lowest bidder for maintenance of telecom networks in four of the six governorates for next three years. Besides, the orders worth INR 516.77 Million are in hand which are under execution. TCIL Kuwait has got 'ASSE GCC HSE Excellence Silver Award 2013' in Health, Safety and Environment (HSE) procedures from American Society of Safety Engineers (ASSE), Kuwait Chapter. TCIL Kuwait Branch is managing and implementing Telecommunications Maintenance and Turnkey Projects continuously for over 30 years. During 2013-14, TCIL has bagged a prestigious contract from Kuwait Ports Authority for maintenance of all PABX, video conferencing and camera monitoring system in all the three ports and its complex for a period of three years. TCIL also bagged contracts from Viva for Supply and installation of Optical fiber Cable Network. Also, many small value Data Cable installation contracts were awarded by the GSM and ISP operators in Kuwait.
During the last financial year, two major projects were completed in the main island of Mauritius. One was Multi Order Contract for Civil Engineering and Cable Works in Mauritius (MT516) of value of MRs. 50.65 Million and the other was Curative Maintenance Contract for Underground Cables (MT528) of value of MRs. 17.43 Million. Apart from the above, one more Preventive Maintenance Contract for Civil & Cable Works (MT522) of value of MRs. 40.70 Million is nearing completion.
The Major clients of TCIL, KSA are STC, SEC, MOBILY, Ericsson, Nokia Siemens Networks, Nokia Siemens Networks Al-Saudia Company Ltd., DATASAD, AL Jomaih and BATCO. TCIL is primarily working on the Latest Fibre to Home (FTTX) for the two Telecom Operators in the Kingdom of Saudi Arabia - Saudi Telecom Company & M/s Mobily. TCIL has rolled out FTTH networks in the districts of Sulaimaniya, Duramiya, and is implementing the rollout in the Districts of Murooj & Warood in the Capital City of Riyadh. TCIL, KSA is being entrusted with the maintenance of the FTTX network in most of the Eastern region of Saudi Arabia because of confidence developed by M/s Mobily in TCIL due to quality work done. TCIL has also been entrusted by STC for construction of Green Field sites for the 3G/4GLTE network of Saudi Telecom Company in the southern region of the Country. As a major breakthrough, TCIL has been allotted Operation and Maintenance for 15 cities for FTTX works by MOBILY for Rs.800 Million for 3 Years. Furthe,r Saudi Electricity Company has allotted job for Rs.750 Million to TCIL for installation for customer connection up to 36 KV including cable laying during the year.
TCIL has carried out external plant works for M/s. National Telephone services and M/s. Electroman for Omantel and C5 Migration project for Huawei in Oman. Company has also been recently awarded Outside Plant Maintenance and Development Project for a value of Omani Riyal 6.44 Million equivalent to Indian Rupees 1015 Million from Omantel. I have given a brief overview of the important projects executed by your company. The detailed description is included in the Director's Report.
TCIL aspires to sustain, expand and excel in its operations in Overseas/ Indian Markets by adopting latest technologies and developing proper marketing strategies.
Apart from reaching new markets and clients, TCIL's objective is to excel in providing solutions in IT, Telecom, Power, and civil Infrastructure Sectors globally, consistently expanding its operations. Accordingly, company shall develop products, solutions and processes which help in generating and accelerating TCIL's business and maintain leadership position. TCIL is focusing on technologies like wireless, FTTH, e-Networks (Health and Education), 4G networks, VAS, e-Governance, Managed Services and Green Telecom.
The corporate governance philosophy of your company is aimed at institutionalizing policies and procedures that embrace the efficiency of the Management and inculcate a culture of accountability, transparency and integrity across the organization. TCIL ensures adoption of good ethics and good business sense, by following the code of conduct. A copy of the code of conduct is also available on the website of the company. All Board Members and Senior Management Personnel have affirmed compliance with the Code of Business Conduct and Ethics.
Company is signatory to the Integrity Pact with Transparency International and has implemented Integrity Pact for all procurements above Rs. 3 lakhs.
CORPORATE SOCIAL RESPONSIBILITY
TCIL is maintaining the highest standards of governance, safety and environmental performance across the value chain. TCIL has carried out CSR activities during 2013-14 as per DPE guidelines and have reported the implementation of the projects on TCIL website. TCIL has proposed CSR project of Tele-education connecting 272 backward districts of country. TCIL intends to take up this CSR project on behalf of all CPSEs, as an implementing agency covering design, development, procurement, installation and commissioning of the network and post commissioning operations and management of the Tele-education services. A Detailed project report and implementation plan for setting up of Tele-education Network for delivering education in under developed regions has been prepared. CSR funds have been used for setting up central servers for the Tele-Education setup. In addition to this, equipments have been procured for setting up virtual classrooms and studios for delivering education on the network. An MOU has been signed with National Institute of Open Schooling for providing Tele-education in backward areas.
Apart from this, TCIL plans to set up Solar Power Plants in rural areas facing acute power shortage in order to facilitate the functioning of schools, hospitals and other essential services as well as improve the quality of life of the people. A Project Implementation Plan for setting up of Solar Generation Infrastructure has been prepared. Besides this, solar equipments have been procured for installation in remote villages.
For internalization of CSR and sustainable agenda, TCIL has installed LED tubes in place of Fluorescent tubes at one floor in TCIL Bhawan which reduces energy consumption levels.
I am grateful to the Government of India, Department of Telecommunications, Telecom Commission, Comptroller and Auditor General of India, Statutory Auditors and Branch Auditors, our Bankers, Exim Bank, ECGC and other valued customers for their continued co-operation, confidence and support. I also extend my thanks to all the employees and shareholders for their support and understanding. I also wish to express my appreciation to the outgoing Directors for their valuable contribution during their tenure. I extend my profound gratitude for the continued patronage, encouragement, support and acknowledge the confidence reposed in me and the Board of Directors
Thank you very much.
CHAIRMAN & MANAGING DIRECTOR