RailTel Corporation was incorporated on September 26, 2000 with the aim of modernizing the existing telecom system for train control, operation and safety and to generate additional revenues by creating nationwide broadband and multimedia network, laying optical fiber cable using the right of way along railway tracks. RailTel Corporation a “Mini Ratna (Category-I)” PSU is one of the largest neutral telecom infrastructure providers in the country owning a Pan-India optic fiber network on exclusive Right of Way (ROW) along Railway track. The President of India, acting through the Ministry of Railways is the promoter of the company.
Presently, optic fiber network of RailTel covers over 58,742 route kilometers and covers 5,848 railway stations across towns and cities in India. RailTel has a strategic relationship with the Indian Railways and it undertakes a wide variety of projects including provision of mission critical connectivity services such as video surveillance system at stations and within trains, ‘e-Office’ services and implementing short haul connectivity between stations and long haul connectivity to support various organizations within the Indian Railways. RailTel also undertakes various passenger services including content on demand services and Wi-Fi across major railway stations in India.
The net proceeds from the IPO will the used to carry out the disinvestment plan and to achieve the benefits of equity share listing on the stock exchanges. The company is attractive given its debt-free balance sheet, consistent payment of dividend, fair valuations, the likely role in digital transformation of Indian Railways, and better margins & return ratios compared to other telecom players it may enjoy long term as well as for listing gains by looking at the strong future growth rates of the company.
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