PUNJAB NATIONAL WIRELESS SYSTEMS LIMITED
Your Directors have pleasure in presenting the XXIII rd Annual Report and
Audited Accounts of the Company for the year ended 31st March, 1998.
PUNWIRE'S EXPANSION TO ADD NEW TELECOM PRODUCTS
Punwire's focus since its inception has been wireless communications. Till
early nineties, usage of wireless communication was restricted to police,
para- military and armed forces and to some extent government institutions.
Punwire was mainly selling equipments to indian Defence , Police, Para-
military forces, some Government institutions and Deptt. of
Telecommunication. The liberalisation of telecom opened up huge
opportunities and Punwire, with its vast experience in telecommunication,
was quick to position itself as a major player in the changing market
environment. In the last couple of years, Punwire has tied up with reputed
companies in the world to address the new market needs.
The Company has tied up with kenwood corporation of japan for their
complete range of 2-way Radio products, Trunked Radios & Trunking Base
To address the huge demand from DoT and other Private Operators, Punwire
has tied-up with Bosch of Germany for manufacture and marketing of SDH
equipments Apart from these, Punwire has also tied up with Harris of Canada
to manufacture and market wirless Local system to DoT and basic telecom
Punwire has tied up with Scientific Atlanta of U.S.A. for manufacture and
marketing of complete range of Head End distribution and HFC Equipment.
Scientific Atlanta is one of the two top leading companies in this field.
The major customers for these equipment are CATV operators and basic
telephony service operators who are expected to adopt HFC equipment for
data and voice communication through single cable.
Since these tie ups have been finalised in the last couple of years. in
some of the products commercial production has started whereas in some of
the other products implementation is in progress.
PUNWIRE'S DIVERSIFICATION IN TELECOM SERVICES
As a part of its diversification strategies, the Company has ventured into
telecom service areas. These include Paging Services, VSAT Services and
Radio Trunking Services, while VSAI service is being operated in the main
Company, the Paging & Radio Trunking Services are being implemented in
Subsidiary/ Joint Venture Companies.
Punewire has tied-up with Gilat of Israel for VSAT equipment and
interactive Distance Learning System, Gilat has worldwide share of 40%
in VSAT market and is also a leader in the field of distance education.
Punewire is the first company in India to introduce interactive Distance
Learning System. The System has been fully commissioned and is being
demonstrated to prospective customers.
Paging is packing up in all the market segments which include small
business, Professionals, corporates, government and households. Paging
offers great opportunity in India economy has all the environmental factors
that has caused a paging boom in the Asian Countries such as:
* High need for low cost solution
* Mass market
* Large geographic spread
* Low telephone density
* Growing developing economy
Paging has now been granted infrastructure status by the Government of
India which will generate investor's interest and also have positive
impact on business plans.
Punwire Mobile Communication Limited
Punwire Mobile Communication Limited (PMCL) is a Company 100% owned by
punwire it has licence to operate paging service in 9 states of India
namely Uttar Pradesh, Madhya Pradesh, Maharashtra, Kerala, Karnataka,
Andhra Pradesh, Tamil Nadu Gujarat and Rajasthan
PMCL has already implemented the paging Network in 125 cities and plans to
implement the Paging Network in 160 cities by March, 1999 in its licenced
Punwrie Paging Services Limited
Punwrie Paging Services Limited (PPSL) is a Company in Joint Venture with
Telia of Sweden having 51% share holding by Punwire and 49% by Telia. It
has licence to operate paging service in 3 states of India namely Punjab,
Haryana and Himachal Pradesh.
PPSL has already implemented the Paging Network in 30 cities and plans to
implement the Paging Network in 50 cities by March, 1999 in its licenced
Paging services are being marketed in both the companies under the Brand
Procall Limited is a Company in Joint venture with Motorola having 51%
share holding by Punwire and 49% by Motorola. It has hence to operate
trunking service in 16 major cities of northen India. These cities include
Delhi, Gurgaon, Chandigarh, Ludhina, Jalandhar, Amritsar, Faridabad,
Ghaziabad,Jaipur, Lucknow, Kanpur, Allahabad, Jammu , Srinagar, Varanasi
Procall Limited has already implemented the Trunking Network in 7 cities
and plans to implement the Trunking Network in 15 cities by March, 1999 in
its licenced area.
Punwire Trunking services Limited
Punwire Trunking Services Limited (PTrSL) is a Company 100% owned by
Punwire. It has licence to operate trunking service in major cities-
Bompaby Madaras, Culcutta, Bangalore, pune Hyderabad, Bhopal, Nagpur,
Patna, Baroda, Guwahati, Indore, Ahmedabad, Vijaywada, Vishkhapatnam,
Bhubneshwar, Cochin, Coimbatore, Surat and Thiruvananthapuram.
PTrSL has already implemented the Trunking Network in 15 cities and plans
to implement the Trunking Network in 20 cities by March, 1999 in its
The Company has funded expansion & diversification programme out of
internal accruals, equity placement and debt during previous years. Now all
the Subsidiary Companies are fully funded in terms of debt and equity
except one paging project for which financial closure is expected soon.
Because of the delay in funding of one of the Paging Project, the Company
had to raise short term loans from various sources during the year.
The Project implementation of all the Subsidiary Companies is as per plan
and cash break even is expected in 1999-2000. The growth in services
business shall add great value to Punwire's investment in these service
companies .Accordingly, Punwire has also setup a holding company to route
the equity investment in service companies. It is proposed to disinvest
part of the equity Punwrie Holdings Limited in the near future. The funds
generated out of equity investment in Punwire Holdings Limited shall
utilised for improving the debt equity ratio of Punwire.
Since the Company has gone into telecom services business which will add
great value to the equity investment by Punwire in the long run short term
profitability of the Company has been affected in view of this, your
Directors are constrained to recommend payment at lower rat of Dividend @
15% for the year ended 31st March, 1998.
The Directors wish to place on record their appreciation of the efficient
and loyal services rendered by all sections of the staff and workers of the
Company. The relations with them continue to be cordial at all levels.
Information as required u/s 217 (2A) of the Companies Act, 1956 read with
Companies (Particulars of employees) rules, 1975,as amended, for the year
ended 31st March, 1998 is annexed.
Annual Reports and Audited Accounts of the Subsidiary Companies viz,
Punwire Holding Limited, Procall Limited and Punwire Telecom Services
Limited for the year ended 31st March, 1998 are enclosed, pursuant to the
provision of section 212 of the Companies Act, 1956.
Shri S. S. Brar, IAS Managing Director, PSIDAC has been appointed as
Director of the company in place of Shri S. C. Aggarwal, IAS, Board of
Directors have placed on record their deep appreciation for valuable
services rendered by shri S.C.Aggarwal, IAS, during his tenure as Director
of the Company.
Shri R. K. Narang has been nominated by IFCI as Nominee Director of the
Company. The Board of Directors have co-opted him as Director of your
Lt. Gen. Harbhajan Singh, PVSM (Retd.) has resigned from his post as a
Director of the Company . Board of Directors have placed on record their
deep appreciation for valuable contribution made by LT. Gen. Harbhajan
Singh towards the growth and prosperity of the Company during his tenure as
Director of the Company.
Shri B. K. Syngal has resigned from the Board of Directors of the Company.
Board of Director have recorded their deep appreciation for his guidance
and valuable contribution towards growth and prosperity of the Company
during his tenure as Director of the Company.
In order to Broad- base the Board of Directors, one additional Director has
been co-opted . Shri Rajan Kashyap, Principal Secretary (Finance) .
Government of Punjab is a senior official of the Government of Punjab. He
was earlier also associated with the Company. To take advantage. of his
vast experience, the Board has Co-opted him as additional Director on the
Shri Ramesh Inder Singh and shri S.S. Muthuswamy are to retire by rotation.
Shri Ramesh Inder Singh being eligible offers himself for re-appointment.
The Directors recommended his re-appointment.
Particulars u/s 217 (1) (e) of the Companies Act, 1956
Particulars as required u/s 217 (1) (e) of the Companies Act, 1956 are
annexed herewith and form an integral part of this report.
M/s. Serva Associates, Chartered Accountants are holding office of the
Auditors of the Company till the conclusion of ensuing Annual General
Meeting ,being eligible, offer themselves for re-appointment . Your
Directors recommend their re-appointment.
Your Director extend the vote of thanks to the Shareholders, Debenture
holders, Financial Institutions, Banks, Joint Venture Partners, Technical
Collaborators, Customers, DoT. State & Central Government and Suppliers for
their continued support to the Company. Your Directors look forward to
receiving continuous support and guidance of all in good measure in future.
On behalf of the Board
ANNEXURE TO THE DIRECTORS' REPORT
Particulars required u/s 217 (1) (e) of the Companies Act, 1956 read with
Companies (Disclosure of Particulars in the Report of Board of Directors)
Rules, 1988 and forming part of the Director's REport for the year ended
31st March, 1998.
Conservation of Energy
a) Energy Conservation Measures Taken
Energy conservation continues to receive special focus in all the units of
the Company. The concept has been extensively promoted to bring about
awareness at all levels.
b) Additional investments and proposals, if any , being implemented
for reduction of consumption of energy.
For the on going and diversification, special care has been taken to order
equipments having best efficiency which ultimately result in saving of
power energy consumption. The Company keeps regularly in touch with new
technology/ inventions in the field of energy saving devices and tries to
adopt them as far as possible.
c) Impact of the measures at (a) & (b) for reduction of energy consumption
and impact on the cost of production of goods.
d) Total energy consumption and energy consumption per unit of production
as per prescribed Form A.
a) Research & Development
1. Specific Area
Development of Microwave Radios
Development of Products as per the specifications of Defence, Paramilitary
Forces and Police.
2. Benefits derived as a result of the above R & D
Saving of valuable foreign exchange by way of import substitution.
The Company has been able to procure large orders.
3. In future the Company is proposing to further strengthen the R & D
Centre for development of new products and would set up communication
4. i) Expenditure On R & D
(Rs. in Lacs)
Current Year Previous Year
Capital 102.17 113.18
Recurring 1.71 2.69
Total R & D Expenditure as a 0.61% 0.76%
% age of total turnover
ii) Technology Absorption Adaptation and Innovation
It is always the endeavour of the Company to absorb the imported technology
and indigenise the components as far as possible.
Benefits derived as a result of the above efforts:
The benefits derived have been in the form of improved quality, high
productivity and lower cost of production.
C) Foreign Exchange Earnings and Outgo
1. Activity relating to export
During the year under report, the Company has not made any export.
2. Foreign exchange earned and used
The details of foreign exchange earned used are given in Appendix E, F, G&
H annexed to the Balance Sheet as on 31.03.1998.