ECONOMY AND INDUSTRY OVERVIEW
Macro Economic Situation
India becomes the worlds second-largest telecommunications market. It has registered
strong growth in the last decade. The mobile operators played a critical role in providing
seamless connectivity to millions of Indians and contributed significantly towards the
economic growth and employment generation. The Government is also continuously focusing on
accelerating the adoption of digital through various initiatives under the Digital India
campaign.
To achieve the objectives of Atmanirbhar Bharat and Make in India missions it is
technology and the wireless sector which are the key pillars to recognize this vision of
Digital India. Wireless sector is the firm backbone of innovations and new age
technologies which are hallmark of Indias transformation into a digital nation. Further
the Indian government has undertaken several initiatives to maximize the opportunity and
ensure the financial stability of the telecom industry, such as Telecom Reform Package,
lowering the reserve price of spectrum in 5G auctions, amending the Right of Way Policy
and working towards redefining the regulatory framework via Draft Telecom Bill.
The Telecom Industry provided key essential services to the nation during the testing
times, becoming a lifeline for the whole economy. This was despite the Industry battling
its own challenges, with the regulatory dues on back of unfavorable judiciary outcoming
adding the pressure on an already consolidated industry. Further, the Indian telecom
pricing remains the lowest globally even post one round tariff hikes and having amongst
the highest data usage globally.
The health of the telecom sector are being protected through much-needed support from
each of the stakeholder, in this regard, the Department of Telecommunications has offered
additional spectrum through auction, reduced the Spectrum usage charges to NIL on the
spectrum acquired through auction from 2022 spectrum auction and allowed spectrum payments
to be spread over the spectrum validity period of 20 years, all of which enabled the
telecom operators to make large commitments in the spectrum auctions as well as towards
rolling out the next generation wireless networks.
The Government has enabled easy market access to telecom equipment and a fair and
proactive regulatory framework that has ensured availability of telecom services to
consumer at affordable prices. The deregulation of Foreign Direct Investment (FDI) norms
have made the sector one of the fastest growing and the top five employment opportunity
generator in the country.
The continued accessibility to mobile services and low priced tariffs has spurred the
growth and deployment of wireless broadband internet. Mobile broadband is the primary
medium to access internet in India as the lack of adequate wired internet infrastructure
restricted its growth only to major cities. Efforts are being made to address the digital
divide by extending inclusive internet access to every Indian, as mobile technology looks
to empower the masses and become the critical means of accessing a broad range of public
services.
Regulatory Developments/ Changes
1. LAUNCH OF "GATI SHAKTI SANCHAR" PORTAL
Universal and equitable access to Broadband Services across the country, especially in
the rural area is one of the most important visions of Honble Prime Minister of India. To
fulfil this vision, it is imperative that backbone of infrastructure is created by
facilitating smooth and efficient deployment of Digital Communications Infrastructure
across the country. The "GatiShakti Sanchar" portal for Centralised Right of Way
(RoW) approvals is now functional with all 36 States/UTs. The portal acts as an enabler
for "Ease of doing business" for telecommunications infrastructure works. The
timely disposal of RoW applications of various services and Infrastructure providers shall
enable speedy infrastructure creation especially for timely rollout of 5G Network also.
The portal will enable applicants from various Telecom Service Providers (TSPs) as
well as Infrastructure providers (IPs) to apply at a common single portal for Right of Way
permissions to lay down Optical Fiber Cable and for erecting mobile towers.
2. TRANSITION TO THE NEXT GENERATION OF INTERNET PROTOCOL
Internet Protocol addresses, or IP addresses, are a core part of how the Internet
operates. The proliferation of new technologies such as 5G, Machine to Machine
Communication, Artificial Intelligence, etc. and thrust on digital initiatives along with
the penetration of broadband and internet services, has necessitated large number of
Internet Protocol (IP) addresses, beyond the current available pool of IPv4 (IP version 4)
addresses. To overcome this shortage, Internet Protocol version 6 (IPv6) was developed,
which improves on the addressing capacities of IPv4 by using 128 bits address instead of
32 bits, thereby practically making available almost an infinite pool of IP addresses. The
adoption of IPv6 based innovative applications in areas like smart metering, smart grid,
smart building, smart cities etc. will keep improving the quality of life of common
citizens.
3. PRIME MINISTERS WI-FI ACCESS NETWORK INTERFACE (PM-WANI):
The Government of India to accelerate proliferation of Broadband services through
Public Wi-Fi networks in the country has approved setting up of Public Wi-Fi Networks by
Public Data Office Aggregators (PDOAs) and Public Data Offices (PDOs). This framework
takes forward the goal of NDCP-2018 of creating a robust digital communications
infrastructure across India. Proliferation of Broadband Services through public Wi-Fi
networks is a step towards Digital India and consequential benefits thereon. This will
encourage technology entrepreneurs to develop and deploy Wi-Fi technology solutions
triggering Make in India. This new eco system will also enable new business models for
shopkeepers as potential PDOs to provide high speed broadband services. No License Fee by
PDOAs and Application providers for providing broadband services using public Wi-Fi
Hotspots will encourage its proliferation and penetration across the length and breadth of
the country. Availability and use of broadband will enhance incomes, employment, quality
of life, ease of doing business, etc.
4. TELECOM ANALYTICS FOR FRAUD MANAGEMENT AND CONSUMER PROTECTION (TAF-COP)
PORTAL:
Department of Telecommunications (DoT) has taken several measures to ensure proper
allocation of telecom resources by Telecom Service Providers (TSPs) to subscribers and
protect their interests in ensuring reduction of frauds. As per existing guidelines,
individual mobile subscribers can register up to nine mobile connections in their name.
Telecom Analytics for Fraud Management and Consumer Protection (TAFCOP) has been developed
to help subscribers, check the number of mobile connections working in their name, and
take necessary action for regularizing their additional mobile connections if any.
However, the primary responsibility of handling the Customer Acquisition Form (CAF) lies
with the Service Providers.
TRAI has issued following Regulation, Direction and Recommendation in the Financial
Year 2022-23.
Regulation
The Telecommunication (Broadcasting and Cable) Services interconnection (addressable
systems) (fourth amendment) regulations, 2022 on November 11, 2022.
Telecommunication Tariff (69th amendment) order, 2022 on December 6, 2022.
The Telecom Regulatory Authority of India (officers and staff appointment)(fifteenth
amendment)regulation,2023 on March 23, 2023.
Direction:
Direction regarding submission of periodical reports on revenue and usage on December
6, 2022.
Order to furnish information on gross revenue, applicable gross revenue, adjusted gross
revenue, spectrum usage charge and license fee, etc. on December 13, 2022.
Directions on measure to curb unauthorized activities using telecom resources and
amendment in codes of practice under TCCCPR, 2018 on February 16, 2023.
Directions on measure to curb misuse of headers and content templates under telecom
commercial communication customer preference regulation, 2018 on February 16, 2023.
Directions to all telecom service provider to submit quality of service (QoS) reports
for each state and union territory(UT) issued on February 24, 2023.
Directions on regarding reporting of major network outages to TRAI on March 28, 2023.
Recommendation:
Recommendation on auction of spectrum in frequency bands identified for IMT/5G on May
9, 2022.
TRAIS response to DOT back reference dated 28.06.2022 on recommendations on
‘roadmap to promote broadband connectivity and enhanced broadband speed on July 25,
2022.
TRAIS response to back reference dated 02.08.2022 received from DOT on TRAIS
recommendation on "enabling unbundling of different layers through differential
licensing" on September 6, 2022
Recommendations on regulatory framework for promoting data economy through
establishment of data centers , content delivery networks, and interconnect exchanges in
India on November 18, 2022
Recommendations on rating of buildings or areas for digital connectivity on February
20, 2023.
Business Overview
Quadrant Televentures Limited (QTL) is a Unified License Services Licensee and an
Internet Service Provider in the Punjab Telecom
Circle comprising of the State of Punjab, the Union Territory of Chandigarh and the
Panchkula town of Haryana. The Company started its operations as a fixed line service
provider under the brand name "CONNECT" in the year 2000. Subsequently, the
Company was granted the UASL License (Unified Access Services License) in the Punjab
Telecom Circle in 2003, which was further migrated to Unified License in the year 2015.
Apart from the UASL License, the Company also holds the ISP (Internet Service Provider)
License Category - A (PAN INDIA) and the IP-1 (Infrastructure Provider-Category -1)
License for providing services in the Punjab Telecom Circle.
Currently, the Company is providing Broadband Services on FTTH/ DSL/WBB/EOC technology,
Fixed Voice (Landline) services, Internet Leased Line and P2P services in the Punjab
Telecom Circle, along with Bulk SMS Services. As on March 31, 2023, the Company had a
total subscriber base of 3.38 Lakhs customers.
The data consumptions and requirement of speed is increasing manifold which is one of
the main reasons service providers and users are looking at fiber-to-the-home (FTTH)
broadband connections as a potential solution. It is widely believed that FTTH is the only
technology with enough bandwidth to handle projected consumer demands during the next
decade reliably. Fiber has a virtually unlimited bandwidth coupled with a long reach,
making it "future safe," or a standard medium that will be in place for a long
time to come.
Keeping all these things in mind the main focus of the QTL team has been to expand the
FTTH footprint across the state of the Punjab. However since FTTH rollout is an
expenditure intensive ventures, thus QTL has roped in multiple partners who are doing
investment on behalf of the QTL from node to the customer premises. The ONT i:e CPE is
also being provided by the partner.
In last one year 0.8Lakhs new FTTH home passes/ports have been rolled out thus
increasing the total FTTH capacity to 4.38 Lakhs. Total FTTH subscriber base has increased
from 1.74 Lakhs in March 2022 to 2.03 Lakhs in March 2023.
OPPORTUNITIES AND THREATS
Opportunities
The existing telecom service providers, operators have made significant investments
towards expanding broadband network across the country. Due to lack of adequate
infrastructure, the growth of wired internet has been restricted to major cities as a
result of which wireless remains the preferred means of connecting to the internet. The
increasing 4G coverage and low priced 4G services have led to significant increase in 4G
users. However, there is significant headroom for broadband wireless penetration (as a
percentage of population) to improve further as rest of India upgrades towards broadband
connectivity. The growth in social media usage, rapidly increasing content consumption and
growth in online commerce coupled with introduction of 5G will continue to drive demand
for broadband services.
The Company is putting all initiatives to maintain the quality of services and
retainability of the subscribers of the Company in view of the prevailing preferences of
the subscriber and competition in the market.
Threats
Enterprises are moving towards cloud-based solutions as businesses are going digital
and are moving away from on-premise solutions. Traditional voice services would get
impacted adversely on account of the shift of focus towards cloud & unified
collaboration solutions and disruption from newer digital technologies. Telecom Companies
have also started offering unified, new age web-based work from home solutions like cloud
telephony, virtual receptions etc., integrated with their traditional services.
Increasing trends towards cloud-based solutions as businesses are going digital and are
moving away from on-premise solutions. Traditional Voice Services would get impacted
adversely on account of the shift of focus towards cloud and conferencing solutions and
disruption from newer breed of digital technologies.
Outlook
The Company continues invest in the brand and marketing assets and have lined up brand
interventions in the coming period which will help create positive word-of-mouth,
strengthen our brand recall and brand equity.
RISK & CONCERNS
The Risk Management framework of the Company ensures regular review by management to
proactively identify the emerging risks, to do risk evaluation and risk prioritization
along with development of risk mitigation plans and action taken to minimize the impact of
the risk. Regulatory team along with legal and networks keeps a close watch on compliances
with regulations and laws and ensures the operations of the Company are within the
prescribed framework, and have also implemented business continuity plan wherever
required.
However, the level of urgency and concern has clearly escalated during this COVID era,
with the survey showing that the cyber threat issue moved up on the top risk list. Telecom
organizations are rightfully concerned that they may not be sufficiently prepared to
manage cyber threats that have the potential to significantly disrupt core operations
and/or damage their brand.
INTERNAL CONTROL SYSTEM AND ITS ADEQUACY
The internal audit for various functions/aspects is conducted by the independent firm
Ernst & Young -LLP, which conduct reviews and evaluation and present their reports to
the Audit Committee and the management at regular intervals. The Internal Auditors
reports dealing with internal control systems are reviewed by the Audit Committee and
appropriate actions are taken, wherever necessary. The framework of the Internal Control
is assessed periodically and performances of the circles are also measured. The Internal
Control is set up in such a way so as to ensure that the Financials and the other records
are reliable for preparing the financial statements of the Company.
The management reviews and evaluates revenue for various products on regular basis and
take corrective action wherever necessary.
SEGMENT WISE AND PRODUCT WISE PERFORMANCE
The Company operates in a single segment. The Product wise performance has been
explained separately in subsequent paras.
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The Company has expanded its wire line services to more than 150 cities / towns of
Punjab and widened its wireless footprint to cover the whole of Punjab Circle.
The Companys operating revenue was Rs. 39625.41 Lakhs during the financial year
2022-23 against Rs. 43789.15Lakhs for the financial year 2021-22 and also the
Company have sustained an operating loss of Rs. 10509.35 Lakhs during the financial
year 2022-23 against Rs. 11634.30 Lakhs for the financial year 2021-22.
Revenue at a glance is as follows:
Parameter |
FY 2022-23 |
FY 2021-22 |
| Unified Access Services |
2,092.94 |
1,816.95 |
| Internet Services |
16,722.71 |
22,088.89 |
| Interconnect Usage Charges |
20,809.76 |
19,883.31 |
| Other Income |
676.29 |
374.97 |
Total |
40,301.70 |
44,164.12 |
FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:
Key Financial Indicators
Telecom Business
Parameter |
FY 2022-23 |
FY 2021-22 |
| Revenue from Telephony Service |
39,625.41 |
43,789.15 |
On Gross Basis
Parameter |
FY 2022-23 |
FY 2021-22 |
| Gross Income |
40,301.70 |
44,164.12 |
| Profit/(Loss) for the year |
-10,509.35 |
-11,634.30 |
Major Expenses at a glance are as follows:
Parameter |
FY 2022-23 |
FY 2021-22 |
| Network Operations Expenditure |
24,352.44 |
30,561.92 |
| Employee Benefit Expenditure |
4,606.36 |
4,463.99 |
| Sales & Marketing Expenditure |
5,371.05 |
4,638.92 |
| Administration & Other Expenditure |
1,988.75 |
2,001.78 |
| Finance Cost |
12,277.41 |
11,790.89 |
Total |
48,596.01 |
53,457.50 |
SHARE CAPITAL
The Authorised Share Capital of the company is Rs.15000 million. Against this, the Paid
up Share Capital is Rs.2860.71 million comprising of Rs.612.26 million by way of Equity
Shares and Rs.2248.45 million by way of Cumulative Redeemable Preference Shares (CRPS).
KEY FINANCIAL RATIOS
There are no significant changes (i.e. changes of 25% or more as compared to the
immediately previous financial year) in key financial ratios. Further, there is no change
in return on Net worth during the year.
MATERIAL DEVELOPMENTS IN HUMAN RESOURCE
Companys planning for people has been built on the principles of being a consumer
centric Company with technology as the base. The organization has equipped itself for high
change vigilance and embedded trust at the foundation of its people agenda and has adopted
digital as the first port of call for all solution building. Continued deployment of
Reward and Recognition, consistent communication by leadership, on aspects impacting
work-life and focus on key HR programs such as Internal Job Postings, Appraisals, Learning
& Development. We are committed to remaining among the industrys leading employers.
The Company had a total 1050 Employee on its rolls as on March 31, 2023. The company
has a professionally qualified work force including B-Tech, MBAs, C.As / C.S.s etc. The
key aspects of our HR practice include recruitment, training and development, and
compensation.
CAUTIONARY STATEMENT
Statements in the Management Discussion and Analysis describing the Companys
objectives, projections, estimates, expectations may constitute a "forward-looking
statement" within the meaning of applicable securities laws and regulations. Actual
results could differ materially from those expressed or implied. Important factors that
could make a difference to the Companys operations include economic conditions affecting
demand/ supply and price conditions in the domestic markets in which the Company operates,
changes in the Government Regulations, tax laws and other statutes and other incidental
factors. Further, the Company retains the flexibility to respond to fast-changing market
conditions and business imperatives. The Company may therefore need to change any of the
plans and projections that may have been outlined in this report, depending on the actual
market conditions.
|
For and on behalf of the Board of Directors |
|
Anushka J. Vagal |
Dinesh A. Kadam |
Place: Mohali |
Director |
Whole Time Director |
Date: August 11, 2023 |
(DIN: 08966439) |
(DIN: 08282276) |
+91-9892691696
