RailTel IPO

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(i) Incorporated in 2006, they are an information and communications technology (“ICT”) infrastructure provider and are one of the largest neutral telecom infrastructure providers in India (Source: CRISIL Report). They are a Mini Ratna (Category-I) Central Public Sector Enterprise, wholly-owned by the Government of India and under the administrative control of the Ministry of Railways.

(ii) Railtel is formed with the intention of modernizing the existing telecom system for train control, operation, and safety and to generate additional revenues by creating nationwide broadband and multimedia network by laying optical fiber cable by using the right of way along railway tracks.

(iii) As of June 30, 2020, the optic fiber network covers over 55,000 route kilometers and covers 5,677 railway stations across towns and cities in India. The transport network is built on high capacity dense wavelength division multiplexing (“DWDM”) technology and an Internet protocol/ multi-protocol label switching (“MPLS”) network over it to support the mission-critical communication requirements of Indian Railways and other customers.

(iv) They operate data centers in Gurugram, Haryana, and Secunderabad, Telangana to host and collocate critical applications for customers including the Indian Railways. In addition to strategic and critical network infrastructure services, they also undertake various ICT projects for the Indian Railways, central government, and state governments, including various train control system projects for Indian Railways.

Railtel Services:

1. National Long Distance (“NLD”) Services:

They provide the digital capacity to carry long-distance telecommunication services and include various teleservices including voice, data, fax, text, video, and multimedia. As part of the NLD services, they offer enterprise customers with (i) leased line services; and (ii) MPLS based virtual private network (“VPN”) facilities.

2. Internet Service Provider (“ISP”) Services:

As part of the ISP services, they offer enterprise customers Internet leased line services with multiple bandwidth options ranging from 2 MBPS and above across India. They also offer retail broadband services through its ‘RailWire’ platform.

3. Passive Infrastructure (“IP-1”) Services:

They provide storage, power, cooling, and physical security for servers and networking equipment of the customers and connect them with a variety of telecommunications and network service providers. In addition, they provide space on microwave towers for collocating base transceiver stations (“BTS”) for telecom operators, small cell sites for extending their mobile coverage, and space for collocating mobile switching centers. They also provide single-core dark fiber for transmission of digital video signals to multiple system operators (“MSOs”) for cable distribution.

4. Data Centre and Managed Hosting Services:

They offer a variety of data center services including Infrastructure as a Service or IaaS, dedicated hosting, managed services, cloud computing, managed e-Office services, disaster recovery services, Aadhar authentication services, and other IT related services such as load balancing services, application hosting, bandwidth services, and advanced firewall services.

5. ICT Hardware, Software, and Service System Integration Projects:

They collaborate with partners and OEMs to undertake ICT hardware implementation, software delivery, and digital transformation projects including the creation of statewide area network (“WAN”) and its maintenance, data center, and facility management services, Wi-Fi projects, city surveillance projects, laying off the statewide fiber-optic network and its maintenance, implementation, and maintenance of end-to-end IT applications of enterprises.

Revenue Breakup

Particulars (Cr) 2020 2019 2018
NLD Services 415 371 389
ISP Services 166 166 148
IP – 1 Service 135 115 120
Data Centre and Managed Hosting 13 7 7
TPaaS 15 14 19
Projects 383 331 291
Total 1127 1004 974

Objects of the RailTel IPO:

to be updated shortly

RailTel IPO Details:

Listing At: NSE,BSE

Promoters And Management:

Government of India.

Financials of RailTel IPO:

to be updated shortly

Comparison With Peers:

to be updated shortly

Recommendation on RailTel IPO:

to be updated shortly

Registrar of RailTel IPO:

  1. Kfin Technology Private Limited

Discussion on RailTel IPO:

    The expected date of the opening of the IPO is 02.12.2020.

    The expected IPO price is 80.