Smaller Passive Infrastructure Providers Reshaping Indian Telecom

Despite the tower companies of India are going through several merger and acquisition, there are some new companies entered in the market - Suyog Telematics Ltd,  Signotox Towers Pvt. Ltd., Pratap Technocrats, SAR Televentures etc.

These companies are looking into new verticals of tower industries for generating revenues from telecom service providers. Innovative solutions from these companies can be cost-effective and energy-efficient. 

Report by Avendus predicts that in next 5 years capital expenditure in the digital infra space might go up to $35-50 billion. They also noted four major trends to drive this expenditure are: in-building solutions (IBS), outdoor small cells (ODSC), data centres (DCs), and fibre networks.

Revival of BSNL, deployment of 4G and 5G tech in their network and Vi's plans to expand 4G and enter into 5G space are also good news for these newcomers despite the presence of big companies like Altius (2.75L towers) and Indus Towers (2.5L towers) and mid-level players like GTL Infrastructure with 26,000 towers and Ascend Telecom with around 18,600 towers.

Suyog was founded in Mumbai in 1995 and has presence in 12 circles - Delhi, UP East and West, Assam, West Bengal, Gujarat, Rajasthan, Maharastra and Mumbai, Karnataka, Orissa, Tamilnadu, Andra & Telengana. Their client list includes all four mobile operators. Suyog is the market leader in the most critical slum sites segment.

Signotox Towers was founded as V-Con Telecom Towers Pvt. Ltd. in 2016. It is HQ-ed in Mohali, Punjab and offering IP1 services in 7 circles: Punjab, Haryana, Madhya Pradesh, Chhattisgarh, Gujarat, Himachal Pradesh and Uttar Pradesh (West). Their client list includes Jio, Airtel, Vi, BSNL, Connect Broadband. 

Pratap Technocrats was founded in 1998 in Jaipur. This company is specialized in telecom tower installation and commissioning which include microwaves, BTS, DWDMs, telecom equipment. 

They also offer O&M (Operation and maintenance) service for all active and passive telecom infrastructure and currently cater to 65,000 towers, 35,000 active nodes and 90,000 kms of fibre network.

iBus Networks was founded in 2013 by Sunil Menon, Subash Vasudevan and Ram Sellaratnam in Bengaluru as a neutral connectivity infrastructure provider for mobile operators. Soon it turned out to be market leader of provider of in-building solutions, outdoor small cells and managed WiFi services. iBUS claims to have provided digital connectivity solutions for over 300 IT parks, 200 hotels, 100 hospitals and 100 malls across the country. iBUS has a presence in over 1,500 sites covering close to 1 billion square feet of tenanted area across more than 40 cities in India.

Since its inception the company grew by getting investment from multiple sources and by acquisition of smaller companies. 

2021: Morgan Stanley backed North Haven India Infrastructure fund invested Rs150 crore. 

2022: Japan's Nomura invested Rs 125 cr.

February 2024: Govt. of India backed investment company he National Investment and Infrastructure Fund (NIIF) invested Rs 1680 cr ($200 million) for a majority stake (50-60%)  

September 2024: International Finance Corporation (IFC), a member of the World Bank Group invested Rs 280 cr.

Acquisitions:

2021: iBus acquired telecom firm Ubico Networks from Shyam Group for Rs 100 crore. The all-cash deal included Ubico's in-building and in-campus neutral-host infrastructure business and all related assets.

August 2022: iBus acquired certain Wi-Fi managed service assets of D-VoiS Communications to expand presence in education and co-living sectors.

January 2023: iBus fully acquired Microsense, Chennai-headquartered High Speed Internet Access (HSIA) services firm, for Rs90 cr. Microsense, a service provider in the hospitality sector, has presence across 20 major cities of India.

SAR Televentures was founded in 2019 in Gurgaon. It chose to be micro tower company. So far the company installed 413 towers with primary tenancies from Bharti Airtel. It recently signed a deal with Vi to install 5,000 small sites with 4G capabilities. SAR may have a deal with BSNL but that is not confirmed. It has plans to invest 42.5 Cr to erect 1,000 towers - probably targeted to Vi and BSNL, which are expanding their networks rapidly. SAR recently concluded a composite equity fundraise of Rs 450 crore, including a rights issue of Rs 300 crore and a public offer of Rs 150 crore, backed by anchor investors such as BoFA Securities, Intuitive Alpha Investment Fund and Negen Undiscovered Value Fund.

The company also maintains assets such as dark fibres, right of way, duct space and tower for lease, rent or sale to TSPs.

In November 2024, SAR Televenture announces to acquire Tikona Infinet for Rs 669 cr in cash, stock deal. With this acquisition, SAR will become an integrated telecom services provider with a presence in ISP services, IP1 services, broadband and enterprise.