Reliance Infocomm will invest Rs 3,000 crore during the current financial year. This is expected to go into the expansion of networks and rollout into more parts of the country. "We need to give Reliance Infocomm a three year timeframe," said Reliance Indus-tries chairman & MD Mukesh Ambani at RIL’s 30th AGM held in Mumbai. He claimed that Reliance Infocomm had achieved a world record by posting cash profits in its first year of operation.
For the financial year ended March 31, 2004, Reliance Infocomm recorded revenues worth Rs 2,700 crore and had a provision for bad debts to the extent of Rs 436 crore.
"The cash profit after provision of bad debt was Rs 160 crore and the net loss was Rs 390 crore," said Mr Ambani. The impact of the infocomm business on the consolidated results of RIL was Rs 265 crore. Reliance Infocomm will expa-nd its services from 1,100 towns to about 5,000 towns in a phased manner, he said. The current expansion will have a capacity to cater to 40 million subscribers, he added.
On the issue of bad debts, Mr Ambani said that the post-paid users will now be given the option of migrating to the pre-paid segment. "This is better for the company since there will be no defaults," he explained.
During the last financial year, Reliance Infocomm also announced the acquisition of Flag Telecom which has given Reliance Infocomm access to global markets.
"Flag’s sub-sea optic fibre cable connects 16 of the world’s top 20 business centres and reaches 75 per cent of the world’s population," he pointed out. Responding to a shareholder’s query, he said Reliance will set up a call centre for its investors which will handle all investor-related queries.
Reliance Infocomm is in the process of rolling out its broadband offering which will bring high-speed connectivity to its users. "India will soon have the largest digital infrastructure in the world and will be among the largest mobile and broadband markets in the world," he said.