Q&A: Puneet Chawla, CMD RailTel: Projects in education, health and defence to help boost revenues

In the months to come, we expect an increase in this base, coming especially from the rural side, which presents a big growth opportunity.

By Nivedita Mukherjee

Railtel, one of the largest telecom infrastructure providers in the country, is betting big on project delivery and opportunities in health and education to become a major player in digital services, Puneet Chawla, CMD of the Mini Ratna enterprise, tells Nivedita Mukherjee.

RailTel has achieved consolidated income of Rs 315 crore in Q1 of FY22, a growth of 21% on a very low base. How do you view the performance?

In the past year, the focus of organisations across sectors has been on digitalisation. Our portfolio of services caters to almost all facets of an organisation’s digital transformation requirement, which helped our business grow.

Demand for HD video-conference, data centre, IBW, VPN services is growing. RailTel’s IPO in February also gave good visibility to the company and the issue was received well with an oversubscription of 42.39 times. Our market cap was Rs 3,000 crore when we went in for the IPO and we have now reached around Rs 4,172 crore. We are on the right track to post higher revenue growth this year as well.

Looking ahead, which are the likely growth drivers for RailTel?

Right now, apart from Railways, our focus is on the health, education and defence sectors. We are also providing IoT, AI-based solutions to clients which will open up new revenue streams. Railwire remained quite inactive for some years with a low subscriber base, but that base has reached four lakh customers across India owing to the rise in work-from-home and educational institutes taking up online classes. In the months to come, we expect an increase in this base, coming especially from the rural side, which presents a big growth opportunity.

RailTel is working on the government’s vision of providing broadband to six lakh villages over the next few years and has created broadband hubs at 6,051 stations pan-India, of which around 5,000 stations are in rural areas. We have recently empanelled our cloud service, RailCloud, with MeitY, which opens up opportunities to bid and win data centre and cloud service projects of governments. With the new draft data policy advocating storage of data within the country, we see a huge potential for our bundle of services related to this.

Projects have become a thrust area for RailTel. What is in the pipeline?

Project business is one of the core areas of RailTel and we have a large number of them for Railways and various government organisations. [We have] about Rs 4500 crore worth of projects [right now] and we should be executing projects worth between Rs 700-800 crore in FY 2021-22.

One major and new area is railway signalling and modernisation. RailTel has been entrusted with replacing old mechanical gears at 26 railway stations of Northern Railway with a computer-based electronic interlocking system. Another important project is installation of Wi-Fi at all railway stations. The Wi-Fi facility is currently available at 6,051 stations and is being offered free for the first 30 minutes of usage per day, after which the user has to purchase prepaid plans for high speed Wi-Fi by paying a nominal fee. We are also going to monetise the network through advertisement-based revenue, for which we are coming out with an EOI shortly.

Besides, we are implementing e-office for Railways with the aim of replacing the manual filing system with digital file system and as on August 6, 15.71 lakh e-files and 90 lakh e-receipts have been created by Railway users of NIC e-office. RailTel has also been allotted work of video surveillance systems at 6,049 railway stations.

Can you share your plans in the new focus areas like health and education?

In healthcare, RailTel is providing a hospital management information system for Railways, which aims at digitising and improving hospital administration and patient healthcare in 125 major health facilities and 650 smaller clinics. Work at 154 hospitals/ clinics has been completed. In education, the big opportunities are in providing AI-based, cloud platform solution for online remote proctored examinations, integrated learning management system and smart classroom solutions.

We are implementing web- and AI-based attendance system for schools in Assam and are in talks with a number of universities and state governments for digital infrastructure. There is discussion for providing 50/ 100 Mbps connectivity and Wi-Fi to all 645 Navodaya Vidyalayas. There is also a plan to go overseas by exploring the digital literacy programme in Kenya.

What is the status of your plan to provide content on demand in Railways?

RailTel is working on the implementation of CoD project to increase non-fare revenue of Railways and to enhance passenger experience. We will provide pre-loaded multi-lingual content on local servers which can be accessed on personal devices (phone, tablet) of passengers through on-train Wi- Fi access points in premium/ mail/ express and suburban trains, as well as Wi-Fi-enabled stations pan-India. The project will be implemented in two years and the earning from the project will be mainly through three streams: advertisement-based, subscription-based and e-commerce/ partnership services. Pilot implementation of CoD in five Rajdhani rakes, one AC suburban rake over Western Railway and Chennai Express over Central Railway is in final stage of completion and testing.