GTL Infra eyes tower tenancies from existing four telcos;Investors are advised not to get scared by Aircel going for Bankruptcy

GTL Infrastructure is also looking to reduce costs by about ₹ 750 crore a year by realigning its debt with revised cash flows and reduction in fixed costs.   -  V_V_Krishnan

Telecom tower firm expects to fill the gap after several operators shut down services

MUMBAI, MARCH 8 Business line

GTL Infrastructure Ltd expects to resurrect itself by adding 10,000 tenancies from existing telecom operators to fill the gaps left by exiting operators.

GTL reckons demand for towers from existing operators as they push data and 4G services will compensate for the tenancies created after several players shut down operations recently. The telecom tower firm expects to add these new tenancies in the next 18 months.

The company is in advanced stages of discussions with the existing four operators — Bharti Airtel, Idea Cellular, Vodafone India and Reliance Jio Infocomm – to add further tenancies.

In fiscal 2018, the company added 6,000 tenancies from Airtel, Idea, Vodafone and RJio as they moved into the space vacated by operators and to garner their subscribers, according to a consultant working with GTL Infra on its restructuring exercise.

GTL Infra is also looking to reduce costs by about ₹750 crore a year by realigning its debt with revised cash flows and reduction in fixed costs. At present, lenders hold a 51 per cent stake in the company, which underwent Corporate Debt Restructuring (CDR) and Strategic Debt Restructuring (SDR) processes.

GTL Infra’s total tenancies stood at 51,587 as of December-end. The company has been impacted by the closure of operations by telecom companies including Tata Telesystems, Reliance Communications, Uninor, Sistema Shyam and Aircel. About 43 per cent of GTL Infra’s revenues were from Aircel.

“Despite the shutting of operations by many telecom firms (its clients), GTL Infra had no overdues to lenders or creditors, and it has never been an non-performing asset even when CDR and SDR processes were on. GTL Infra had completed its merger with Chennai Network Infrastructure Ltd, and was to induct a new investor as part of SDR process,” he said.

When contacted a company spokesperson declined to comment.

In talks with vendors

“The lenders are exploring the sale of debt to asset reconstruction companies, securitisation companies, non-banking financial companies and other eligible buyers,” it said in a statement to the BSE.

The company is also re-negotiating its arrangements with existing vendors. “These steps will enable the company to remain EBITDA positive during the turnaround phase.”

Following the telecom crisis, GTL Infra has revised its tenancy outlook to 26,639 for fiscal 2018 from the earlier 55,000, revenues outlook to ₹2,267 crore (₹2,600 crore) and normalised EBITDA to ₹978 crore (₹1,350 crore).