It is a matter of great satisfaction and delight to
share with you the performance of Quippo over the last fiscal. The
company that we started in the face of many geographical, logistical
challenges besides the challenge of the gradual acceptance of equipment
rental as a concept, stands proud and tall as an industry leader today.
At the core of our success lie our values of creative innovation and
intrepid enterprise. Mooting the path-breaking concept of infrastructure
equipment on rent wherever whenever has been no mean task. And to bring
it to its logical conclusion as a successful, sustainable business model
has been a long arduous journey. However, our faith in our idea, team
and the unflinching support of our associates and investors has come to
its fruition.
Let's take a look at the global scenario in the context of growth in
the Indian subcontinent. The coming five years will witness investment
in Indian infrastructure sector to the tune of US$ 350 billion.
Presently construction equipment industry in India (2006-07) is USD 3.5
Billion and expected to double at approx US$ 7.0-7.5 Billion by FY
2009-10. Out of this, rental equipment share %age (2006-07) is just 7 %
at USD 245 Million but it is expected to get tripled at 21 % by FY
2009-10. Of the total investment requirement of Rs 14,560 billion, 44%
is expected from Public-Private-Partnership. Both, public and private
sectors, working in partnership and collaboration with development
agencies, are expected to bring about significant and sustainable
improvements in India's infrastructure.
In the absence of an organized market for used infrastructure equipment
and the industry organization being weak, the sector faces challenges to
its growth. However, Quippo being the first equipment rental company in
India, it offers customized solutions that cater to specific needs of
customers.
The joint ventures with some significant partners, global and local, as
well as strategic investments are sure to act as propellants to our
growth and also underline Quippo's position of leadership in the
infrastructure equipment rental industry.
The coming together of such companies who have shared values will go
far in effecting a reduction in cost of funds and therefore, deliver
higher profitability.
Quippo Telecom has recently announced its partnership with Tata
Teleservices to create most valuable and largest independent telecom
Infrastructure Company in the country. Under the terms of this merger of
their passive infrastructure businesses, Tata Teleservices Limited
(TTSL) and Quippo Telecom (QTIL) will swap 51 per cent and 49 per cent
stake, respectively, in the infrastructure business held by them. The
management rights in Wireless-TT Info-Services Limited (WTTIL)—the
tower arm of Tata Teleservices—shall now move over to an
independent & professional management run by Quippo Telecom, to make
it a truly independent tower operator without being managed by a Telco.
The combined entity will, therefore, have a portfolio of over 21,000
towers thereby making it the largest independently managed tower company
in India, with an enterprise valuation of approximately Rs. 13,000 crore
(US $2.6 Billion).
Quippo is well entrenched on the path to significant growth. In fact,
Quippo is expected to double its asset and revenue base year on year for
the next few years. Given this state of excitement in the economy in
general and the infrastructure equipment rental industry in particular,
I'm confident that team Quippo can and will continue to move from
strength to strength.
I wish all members of the Quippo team, all investors, partners and
customers the very best.
Sunil Kanoria
VCMD, QIEL
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