RailTel has been riding high on growth, triggered by the rapid expansion of digital services in the country. The company has been performing well operationally and financially, and now plans to leverage new opportunities in the data centre and cloud domains. In an interview with tele.net, Aruna Singh, chairman and managing director, RailTel, talks about the company’s focus areas and growth plans…
What have been RailTel’s key operational and financial highlights during the past six months?
Despite the slow recovery from the global pandemic over the past two years, RailTel has not only managed to keep its boat afloat but has also posted higher profits consistently for the past few years. We ended the previous financial year with another high, posting a growth of 15 per cent with our total revenue at an all-time high of Rs 16.28 billion as against Rs 14.11 billion in the previous financial year. All other financial parameters such as profit before tax, profit after tax and earnings per share have also shown consistent and phenomenal improvement over previous years. Exploring new markets, new sectors and new customers while retaining old customers is the guiding principle for the company, which has resulted in orders worth Rs 8.05 billion during January to June 2022.
This positive momentum is being maintained in the current fiscal year as well, which is evident from the consolidated income of Rs 3.85 billion during the first quarter – a growth of 22 per cent over the first quarter of financial year 2022. With an order book of over Rs 58 billion, we are looking to continue our positive financial and operational performance.
RailTel has been instrumental in the digital transformation of Indian Railways. What progress has been made on that front so far? What are your plans for the future?
RailTel started its journey as a telecom service provider to Indian Railways in the year 2000. Today, it stands as one of the largest neutral telecom infrastructure providers and a trusted information technology and information and communication technology service provider in the country. RailTel’s service basket is now well diversified, with services being offered to a number of government and private clients in different sectors of the economy.
The manual/physical filing system of Indian Railways has been replaced with a paperless digital workplace solution – NIC e-office – in one of the biggest e-office initiatives in the country, covering 216 railway establishments across India. This has helped increase operational efficiency, traceability and transparency. HD video conferencing services for the railways and other organisations, connecting people across the country, is another big service being provided to promote ease of doing business, and reduce administrative costs and man-hours drastically. To digitise hospital administration, RailTel has implemented the Hospital Management Information System for all hospitals and health units of Indian Railways, and has integrated it with the Ayushman Bharat Digital Mission. Many more units and modules are being added to this system continuously.
To increase proactive security in railway premises, internet protocol (IP)-based video surveillance systems are being implemented by RailTel at more than 5,000 railway stations and centralised monitoring rooms are being set up at all divisional and zonal headquarters of Indian Railways.
Signalling is a core expertise area for RailTel, and based on experience and knowledge, the company is currently working on replacing manual signalling systems with modern electronic interlocking for 26 stations of Northern Railway. The long term evolution-based high speed mobile communication corridor project for Indian Railways, using the latest wireless communication standard worldwide to facilitate modern railway signalling and data-centric applications, is another ambitious project RailTel is aiming to be a part of. The company has recently ventured into tunnel radio communication and is currently working on five such projects for some critical sections of different zonal railways. The technology being used for these projects is the first-of-its-kind for Indian Railways, and is slated to improve safety and efficiency drastically.
RailTel is also implementing a converged communication system based on modern all-IP telecom infrastructure in over 230 stations in the South Western Railway zone. This may become a showcase for the technology and a role model for the other zonal railways.
Some other important upcoming projects that are either being planned or executed are the Railway Display Network and a content-on-demand service to improve passenger experience and generate non-fare revenue for the railways.
How do you see the data centre and cloud space evolving in India?
The Covid-19 pandemic and the subsequent lockdown resulted in an unexpected surge in the consumption of data, generating demand for more data storage facilities and leading to an unprecedented boom in the number of data centres.
The Digital India campaign led to an increase in internet consumption. The rise of remote work, fintech and other sectors, the emergence of advanced technologies including internet of things (IoT), artificial intelligence (AI) and machine learning (ML), favourable regulatory support, the rapid growth of cloud computing, and government efforts to promote a digital economy are some of the key factors contributing to the demand for data centres and cloud storage. Adding to this is the interest of investors who are exploring this space as a new and promising investment opportunity.
RailTel has been actively pursuing projects in the data centre and cloud space. In this regard, what are the company’s key projects currently in progress? Are there any other projects in the pipeline?
RailTel has two Uptime USA-certified Tier III data centres at Gurugram and Secunderabad, through which it offers a range of data centre services including infrastructure-as-a-service, dedicated hosting, managed services, cloud storage, disaster recovery services and Aadhar authentication services. The company is currently providing data centre-related services to a number of clients such as the Defence Research Development Organisation, Madhya Pradesh State Electronic Corporation Limited and the Indian Railway Finance Corporation. Recently, RailTel designed and established a “Health Cloud” at the Visakhapatnam premises of Andhra Pradesh Med Tech Zone, which is the world’s first integrated medical device manufacturing hub. Further, we are setting up edge data centres jointly with industry partners under the public-private partnership model at 102 locations in Tier II and Tier III cities to take advantage of the over-the-top (OTT) service boom.
RailTel has also set up a specialised Security Operation Centre for onsite and offsite centralised and consolidated cybersecurity incident prevention, and security event monitoring services. This expands the company’s service portfolio to a great extent, making the team ready to take up challenging projects in the data centre and cloud space.
How has RailTel’s experience been in the retail broadband space? What are some of the key demand drivers for this segment?
RailTel’s retail broadband service, RailWire, is a unique collaborative model whereby local cable operators and entrepreneurs are being roped in to provide last-mile connectivity. Currently, there are 472,000 RailWire subscribers, and our target is to reach 600,000 subscribers by end of March 2023. In order to expand the reach of its services, MoUs are being signed with various state power transmission companies to utilise their optical fibre cable network. Recently, RailTel launched OTT-bundled broadband plans, which are being appreciated by subscribers.
How is RailTel’s high speed Wi-Fi project progressing? What have been the key highlights of the project so far?
RailTel’s public Wi-Fi network, spread across over 6,100 railway stations, is one of the largest integrated Wi-Fi networks in the world. This has also paved the way for setting up common service centre kiosks at railway stations across India.
RailTel is focusing on bringing RailWire Wi-Fi to over 100,000 villages within a 5 km distance of rural railway stations. So far, RailWire has reached over 12,000 such villages, where lack of infrastructure demotivates other players from providing high speed internet.
With a vision to create a nationwide public Wi-Fi ecosystem, the Government of India has launched the PM Wi-Fi Access Network Interface (PM-WANI) project, in which RailTel is playing a pivotal role. The Wi-Fi network at 400 railway stations is already PM-WANI-compliant, and this will soon be extended to all 6,102 stations across the country.
Going forward, what will be some of the new growth avenues and revenue opportunities that you plan to explore?
RailTel is now a Rs 30 billion company in terms of market capitalisation, with an annual turnover of over Rs 16 billion. The company is actively exploring opportunities for safe city surveillance projects; IP-based CCTV surveillance systems for police stations, district courts and subdivisional courts; smart energy meters; automatic number plate recognition systems; radio frequency identification boom barrier-based weighbridge automation; vehicle tracking and fleet management; etc. With technology advancing rapidly, RailTel is also upgrading itself and gearing up to provide various cutting-edge technologies such IoT-, AI- and ML-based services. It is working at the forefront of national digital transformation activity and is fully geared up to fulfil the prime minister’s vision of activating India 2.0 (New India), fuelled by Digital India, Make in India and Aatmanirbhar Bharat. In short, RailTel is now focusing on becoming a trusted digital transformation partner for organisations and the nation.