A consortium led by Tata Consultancy Services (TCS) has received an order worth ₹15,000 crore from state-run Bharat Sanchar Nigam Ltd (BSNL) for deployment of 4G network across India.
The deal comes at a time when India's top two wireless carriers – Reliance Jio and Bharti Airtel – are vying for 5G subscribers. Private telecom operators are on a 5G roll-out spree across India, having already launched in over 300 cities since October 2022.
About a third of wireless data users in India, or around 300 million subscribers, are expected to use 5G services by March 2025, as against an estimated 20-25 million as of March 2023, according to CRISIL Ratings. The remaining two-thirds would continue to use 4G.
In July 2022, the Union Cabinet had approved the second revival package worth ₹1.64 lakh crore for BSNL to address the telecom public sector undertaking’s (PSU) financial woes and upgrade its services. The package incorporated three elements — expanding BSNL's services and upgrading their quality, de-stressing the telco's balance sheet, and expanding BSNL's fibre network by merging the BharatNet infrastructure laid by Bharat Broadband Network Ltd (BBNL) with it.
Administrative allocation of 4G spectrum, and subsequently 5G spectrum, will be carried out under the first element, the government had said, adding that BSNL will be allotted 4G spectrum in 900 MHz and 1800 MHz band at the cost of ₹44,993 crore through equity infusion.
Private telecom operators held a 90.63% market share in February whereas BSNL and MTNL, the two PSU service providers, had a market share of only 9.37%.
Reacting to the order win, shares of IT bellwether TCS rose as much as 1% to ₹3,249 apiece on the BSE. TCS reported a 14.8% year-on-year jump in its consolidated net profit at ₹11,392 crore for the quarter ended March. Revenue of India’s largest software service company rose 17% year-on-year to ₹59,162 crore in the fourth quarter of 2022-23. The company’s operating margin for Q4 FY23 stood at 24.5% while net margin came in at 19.3%. The IT giant announced a final dividend of ₹24 per share.
India is expected to have around 150 million 5G subscribers by 2024, aided by faster adoption in the second half of 2023, according to telecom gear maker Nokia. The combined 4G and 5G subscriber base in the country will rise to 990 million by 2024, Nokia said in a report.
Cumulative 5G smartphone shipments will cross the 100 million mark in the June quarter, surpassing 4G smartphone shipments by the end of 2023, the report said. As many as 85 million out of 730 million active 4G users had 5G capable devices, it added.
