As Net Debt Piles Up To $7 Billion, Reliance Communication Faces Key Test

[csmart 472]

even a small kid is aware of the problems with RCOM. but the management simply does not want to solve them. earlier, RCOm was innovator in terms of pricing and now they have become imitator.

i am facing problem with RCDMA network since a month. it just started one day out of the blue. called customer care atleast 20 times, exchanged emails every 3 days, still info is that complain is with network dept. earlier we had problem with vodafone in the office. we sent them mail and they came and check the network. they installed booster which cost about Rs. 50000/-. the reason for installation, my total payment for various nos was about 10000 so for them it was matter of 5months. customer satisfaction, so will not leave their network, and they can also improve network for others in adjacent offices.

for RCOM, it simply does not care if few customers leave.

[rajeshkatiyar 3]

even a small kid is aware of the problems with RCOM. but the management simply does not want to solve them. earlier, RCOm was innovator in terms of pricing and now they have become imitator.

i am facing problem with RCDMA network since a month. it just started one day out of the blue. called customer care atleast 20 times, exchanged emails every 3 days, still info is that complain is with network dept. earlier we had problem with vodafone in the office. we sent them mail and they came and check the network. they installed booster which cost about Rs. 50000/-. the reason for installation, my total payment for various nos was about 10000 so for them it was matter of 5months. customer satisfaction, so will not leave their network, and they can also improve network for others in adjacent offices.

for RCOM, it simply does not care if few customers leave.

They are butcher hearted even to their premium customers.Quality is no issue In UP the network often goes down for days and nobody bothers.It is clear cut case of company suicide

[raccoon 53]

That seems apparent... but whats even more baffling is the new customer addition figures they are posting. I cannot believe they are getting so many customers. Very, very few people I know have reliance phones; esp. GSM.

[vvinayakpai 26]

RCOM has ceased from being a Imitator as well. It is too busy in trying to rescue itself from the 2G scam that they have stopped even responding to competitions tariff plans. God alone can save them!!!!!!!

[rajeshkatiyar 3]

That seems apparent... but whats even more baffling is the new customer addition figures they are posting. I cannot believe they are getting so many customers. Very, very few people I know have reliance phones; esp. GSM.

Myfriend

These are all false figures Myall friend circle do not have a Reliance number It all started when

Anil took over and quality gone by same day They started ChineseClassic sets started cheating and

looting. I predicted in same forum about 3 years ago about their future collapse and it happened very

fast . My new forecast is Mukesh is soon going to take it over

[ssk the gr8 2]

That seems apparent... but whats even more baffling is the new customer addition figures they are posting. I cannot believe they are getting so many customers. Very, very few people I know have reliance phones; esp. GSM.

Myfriend

These are all false figures Myall friend circle do not have a Reliance number It all started when

Anil took over and quality gone by same day They started ChineseClassic sets started cheating and

looting. I predicted in same forum about 3 years ago about their future collapse and it happened very

fast . My new forecast is Mukesh is soon going to take it over

and how is that gonna happen? don't u know the brothers have divided the companies!

[vvinayakpai 26]

And with the deep kinf of trouble RCOM is in, even if Mukesh has the money he would not buy it. Because at the end of the day he would be acquiring LITIGATION rather than an ASSET in the backdrop of the 2G and related scams!!!!!!!!!!

[raccoon 53]

That seems apparent... but whats even more baffling is the new customer addition figures they are posting. I cannot believe they are getting so many customers. Very, very few people I know have reliance phones; esp. GSM.

Myfriend

These are all false figures Myall friend circle do not have a Reliance number It all started when

Anil took over and quality gone by same day They started ChineseClassic sets started cheating and

looting. I predicted in same forum about 3 years ago about their future collapse and it happened very

fast . My new forecast is Mukesh is soon going to take it over

Yes, I had mentioned it myself. But frankly, I did not think it would come to this. Even Airhell cheats and all... in fact on a much grander scale. Network is also bad in some circles/areas. And they not just surviving but thriving. You can get away with a lot here. After all, we Indians are supposed to be tolerant. But of course what Airhell does not have to deal with is CDMA and handset issues and all. What is going on at RCom is just.... hmm... strange!

Edited June 3, 2011 by raccoon

[rajanmehta 4,056]

Reliance Communications and R-Infra Out of The Elite Mumbai Stock Exchange Sensex

Source Jun 18, 2011, 05.37am IST

MUMBAI: The BSE has decided to take two Anil Dhirubhai Ambani Group stocks-Reliance Infrastructure and Reliance Communications (RCOM)-out of the elite sensex index, which analysts say could lead to a selling pressure on the two stocks. In a late evening development on Friday, the BSE's index maintenance committee simultaneously replaced these two ADAG group scrips on the sensex with Coal India and Sun Pharma.

While Coal India is the most valued PSU and the second most valued company in India with a market capitalization of Rs 2.5 lakh crore, Sun Pharma, with a market cap of nearly Rs 50,000 crore is the most valued pharma company now. The changes are effective August 8, a BSE release said. The exclusion of R-Infra and RCOM is sure to add pressure on these stocks, since fund managers who have benchmarked their funds, including passive sensex-based exchange traded funds, will now be forced to sell these stocks and buy the two scrips which have now been included in the index.

Lately the RCOM stock has been under tremendous selling pressure as it failed to meet the growing challenges in the telecom space with its peers competing fiercely on tariffs, customer service and also acquisition of new clients. The company in particular and the ADA group in general faced another setback when the government agencies investigating the 2G telecom spectrum scam arrested three of its top executives and grilled the group's chairman Anil Ambani. Over the last one year, while RCOM has lost nearly 50% of its value to Rs 95 on the BSE now, R-Infra too lost over 50% to its current level of Rs 580.

RCOM was included in the BSE sensex in June 2006, within months of it being listed on the BSE after the company was demerged from Reliance Industries. It had then replaced Tata Power. Data on the BSE website does not show when R-Infra was included in the elite 30 stocks. The inclusion of Coal India was expected since its blockbuster IPO last November. However, BSE's rules for inclusion in the sensex, among others, required a continuous trading history of six months.

For Sun Pharma, this is the second entry into the sensex, but on both the occasions the same has been dramatic. The stock was first included in the index in January 2009 when it replaced Satyam Computer, soon after the accounting fraud in the software major was revealed. And this time, it is replacing RCOM, which was one of the most talked about stocks on Dalal Street just a few years ago.

Edited June 18, 2011 by rajanmehta

[KapilAgrawal 340]

"RIL may have to acquire Reliance Communications for telecom success: Kotak Institutional Equities research report"

Press Trust of India

Sunday Jun 19 2011, 11:45 hrs

In its pursuit to become a leading player in telecom space , Mukesh Ambani-led Reliance Industries group may have to acquire younger brother Anil-run Reliance Communications (RCom), a report has said.

RIL's proposed re-entry into telecom sector is currently limited to broadband wireless business and it might have to acquire "one or more extant telecom operators" in the voice segment, brokerage firm Kotak Institutional Equities said in an equity research report on Reliance Industries.

The report further said that the acquisition route might also not be much value-accretive, unless RIL can acquire RCom, which became part of the Anil Ambani group as part of a family settlement between the two brothers in 2005.

Kotak Institutional Equities, however, immediately clarified that it was not aware of RIL's interest in acquiring RCom or whether Anil Ambani group was interested in selling the telecom venture to Mukesh-led RIL group.

When contacted, both RIL and ADAG groups did not reply to emailed PTI queries seeking their comments on the report. The specific queries on whether they were interested in any deal involving acquisition of RCom by RIL also remained unanswered.

Last year, RIL acquired 95 per cent stake in Infotel Broadband Services, which emerged as a successful bidder for pan-India Broadband Wireless Access (BWA) spectrum sold by the government. RIL has invested over Rs 4,200 crore in Infotel.

Talking about RIL's re-entry into telecom with this BWA licence, Kotak report said that RIL "will have to contend with well-entrenched players and a small (but growing data market."

"We are not too sure about the economics of a standalone BWA business. Also, RIL may have to prepare a strategy for voice, which may involve acquiring one or more extand telecom operators," the report noted.

The report said that it also doubted that an entry into telecom through acquisition was going to create much value.

"The telecom landspace is quite competitive, regulations are becoming increasingly hostile and Reliance Communications' existing brand presence may confuse potential subscribers unless RIL can acquire RCom," it said.

Kotak Institutional Equities added: "We do not know if RIL has any interest in acquiring RCom or RCom's major shareholder has any interest in sharing RCom to RIL."

The promoters Anil Ambani group own 67.86 per cent stake in RCom, while the remaining shares are spread among FIIs, domestic institutional investors and others.

The Ambanis-promoted conglomerate ventured into telecom when both brothers were together in unified Reliance group.

The telecom business went to Anil after a division of the group between two brothers, although Mukesh has been credited for setting-up of telecom business year-after-year in RIL's annual reports till as recently as in 2009-10.

" Mukesh Ambani had set up one of the largest and most complex information and communications technology initiative in the world in the form of Reliance Infocomm (now Reliance Communications," RIL said in its annual report for 2009-10.

However, the annual report for the latest fiscal 2010-11 has no mention of this credit, although it talks about the group's proposed broadband telecom business.

Earlier this month, Mukesh Ambani said at RIL's AGM that the group would develop its broadband business plans over the next three to five years and currently it was in the process of conceptualising the products and services.

He also named broadband business as one of the focus areas for RIL group going forward.

The Kotak report said that RIL's previous telecom foray has not been very successful and blamed it partly on the lesser focus on the business at a critical time of growth in the industry, due to the group's long-drawn split in 2005-06.

It also said that RIL has been very conservative with its acquisition strategy, while its overall business approach has also turned conservative after remaining "ultra aggressive" in the 1980s and 1990s.

The report also noted that RIL needed to improve its corporate governance practices, significantly enhance its disclosures and simplify its corporate and organisational structure to help investors take a more informed view.

The Kotak report also called for change in RIL's business model and approach for creating shareholder value and observed that the power sector no more appeared a priority growth area and the investment in retail business were below targets.

The detailed queries emailed to RIL remained unanswered on these observations made in the Kotak report.

[ssk the gr8 2]

if ril acquires only one of the gsm or cdma division it will be good

then both the companies can focus on the respective technology they own

[vvinayakpai 26]

It really sounds good that RCOM may again become a part of the RIL group. But things are not simple as that. Anil Ambani would definitely not sell out because it would affect his reputation and also the stock prices of his other companies. Also fingers would be raised against ANil Ambani about his capability to take forward the other companies if he gives up this easily on the RCOM front. Also RIL would be acquiring a lot of litigation from such acquisition which would show on their stock prices as well.

At the most I would expect a closer alliance between the two companies facilitation a slight cash flow from RIL to RCOM enriching each other on the cash front as well as the asset front. A full fledged acquisition or a change of management at RCOM is completely ruled out according to me keeping in mind the present scenario.

[rajeshkatiyar 3]

It really sounds good that RCOM may again become a part of the RIL group. But things are not simple as that. Anil Ambani would definitely not sell out because it would affect his reputation and also the stock prices of his other companies. Also fingers would be raised against ANil Ambani about his capability to take forward the other companies if he gives up this easily on the RCOM front. Also RIL would be acquiring a lot of litigation from such acquisition which would show on their stock prices as well.

At the most I would expect a closer alliance between the two companies facilitation a slight cash flow from RIL to RCOM enriching each other on the cash front as well as the asset front. A full fledged acquisition or a change of management at RCOM is completely ruled out according to me keeping in mind the present scenario.

You are right debt and litigations are problem but evaluation is done accordingly.Anil will never like it but things

will happen automatically. Please do not forget he is incapable certified by his own father

[Arun 795]

Reliance Communications on a hiring spree to boost wireless service

Monday, June 20 2011. 1:00 AM IST

livemint.com

To strengthen its wireless services business, which has faced severe challenges in recent times, Reliance Communications Ltd (R-Com), a part of Anil Ambani’s Reliance Group, is tapping into an external talent pool, including elder brother Mukesh Ambani’s Reliance Industries Ltd (RIL).

In the past three months, India’s second largest mobile phone company by subscribers, has hired three senior executives to look after functions within the wireless business such as device and data services, brand and communications, and finance.

Kaushik Pillalamarri, who has joined as head of R-Com’s data and devices segment, will “lead the company’s focus in the fast-growing data segment as well as evaluate introduction of new devices in the Indian markets”, said a senior company executive, who did not want to be identified. Pillalamarri joined R-Com from Verizon Communications Inc., where he was director for new product innovation and development, and based in the US.

Peshwa Acharya, who was a vice-president and chief of marketing at Reliance Retail Ltd, RIL’s retail arm, has joined R-Com as a senior vice-president for brand and communications in its wireless division.

The telecom operator has also hired Deepak Gupta as chief financial officer of its wireless business. Gupta was previously with real estate firm Emaar MGF Land Ltd, where he was vice-president for finance.

R-Com has recruited Terry Coutinho to head its business process outsourcing operations. Coutinho was earlier heading service partnership at Vodafone Essar Spacetel Ltd.

Syed Safawi, president of R-Com’s wireless business, said attracting talent from outside the company is as important a growth strategy as developing internal manpower.

“We are glad to evoke keen interest from seasoned professionals from leading global and Indian telcos in wanting to further their careers at Reliance Communications,” Safawi said.

R-Com had rough sailing in fiscal 2011.

It is one of the entities being examined for a possible role in the alleged wrongdoings in the government auction of second generation telecom spectrum in 2008. Three of its executives are in prison pending investigation.

Ajay Parmar, head of research at Emkay Global Financial Services Ltd, said hiring a person to lead R-Com’s brand and communications function may be a strategy to defend the company’s image.

R-Com is also under pressure because of a tariff war between telecom operators in India. Its performance on some key indicators have declined.

Average revenue per user fell to Rs.116 as on 31 March from Rs.158 a year ago. In the same period, revenue per minute on R-Com’s wireless network declined 8.33% to Rs.0.44, but has been stable at that level the past two quarters.

Minutes of usage per subscriber declined 21% to 262.

On Friday, R-Com and another Reliance Group company, Reliance Infrastructure Ltd, were removed from the Sensex, the 30-stock benchmark equity index of the Bombay Stock Exchange (BSE).

Over the past year, R-Com’s share price lost 50.3% on the BSE, while the Sensex gained 1.44%. R-Com’s closing price of Rs.95.1 a share on Friday was a decline of 88.41% from a high of Rs.820.8 a share on 9 January 2008.

R-Com’s wireless business, which accounts for 53% of its consolidated gross revenue, has been under pressure the past year and the new appointments might be to provide a fillip to the business, analysts said.

“The company has gone through a tough time and some senior-level people have moved out. The new recruitments may be a consequent re-alignment,” said a telecom analyst with a Mumbai-based brokerage. He, too, did not want to be identified.