Scripscan:Birla Ericsson Optical Ltd
BSE code: 500060
cmp:15
Story:Birla Ericsson Optical Ltd operations are classified into Telecom Cables comprising primarily Optical Fibre Cables (OFC) and Polyethylene Insulated JellyFilled Telephone Cables (JFTC).The OFC is used in long distance networks and generally forms the backbone of all telecom networks. It is also used in local area networks requiring high speed connectivity and high bandwidth.A large deployment of OFC in the entire network is on the anvil primarily due to the Fibre-To-The-Home access network implementation which is stated to take-off during the current year with renewed thrust and momentum. Telecom Service Providers are progressively going beyond copper to enable new services,application and revenue streams. Optical Fibre is increasingly expected to be a major platform for emerging multimedia and data services and will ensure massive revenue over the coming years.The JFTC is predominantly used in the subscriber access telecom networks and broadband services.The bulk of demand for JFTC in India is attributable to the expansion of the wire line telecom networks by the public & private operators besides regular replacement of old copper cables and deployment of high speed access network to make them broadband enabled.The company has also successfully launched a variety of new products including Structured Cables,Specialty Communication and Data Cables,etc.With the strategic intents of maximizing opportunities for copper connectivity within wireless and fixed line broadband segments and de-risking of its revenue model by creating alternative revenue streams in order to reduce dependence on traditional JFTC.These efforts have yielded positive results and it has successfully executed many orders for Specialty Copper Cables during the last fiscal to potential users and the intermediaries. The Company also diversified into Automotive Wires and attracted good customers in the country.Birla Ericsson Optical has also taken a strategic decision to participate in turnkey projects involving telecommunication cables which eventually will lead to additional revenue opportunities by cross-marketing its business to the customers.Birla ericsson's business model looks robust and the above mentioned develoments should help it to sparkle a mark turnaround in the coming fiscal.Its main peer sterlite tech have had a dream run in the bourses.With everything looking rosy birla ericsson too should follow suit.At 15rs I feel the counter to be a hot bet.
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