The Hindu Business Line : Zip Telecom aiming at Rs 1,000-cr revenue

"We are talking to all the telecom players and hope to clinch a deal with one of them by June-end," the company's President, Mr Shishir Lall, told Business Line.

Zip's V2 pay phones are GSM and CDMA compatible and hence, would be attractive for both basic and mobile operators, he added.

Mr Lall said that V2 helps the PCO owner in generating about 30 per cent higher revenue because it has an in-built auto-conference unit.

He added that the current market size for pay phones is around Rs 8,000 crore.

"With more competitors, the market size would grow further."

According to Mr Lall, the company has already installed 20,000 phones since it began operations three years ago.

Zip Telecom posted revenues of around Rs 200 crore in its third year of operations.

It started earning profits in its second year itself.

As part of its expansion plans, the company might start selling phone cards, the President said.

"We are in a win-win situation. Our decision to keep away from basic or mobile services has paid off, as our business is profitable. We can only grow from here."

Zip Telecom provides pay phone services to location owners and users through a network of franchisees.

In Maharashtra, it has tied up with Hughes Tele for installing pay phones at various locations.

Currently, Zip Telecom manages 20,000 franchisee pay phones in 25 cities.

Mr Lall said that the company has four revenue streams - from the usage of ZipFones, advertising through ZipFones, revenue from franchisees and maintenance fee.

Zip Telecom provides technical support and service for all its franchise locations, he added.

The key shareholders in Zip Telecom are Anderson Weinroth Capital Corp of New York and American Insurance Group, which together have invested around $27.5 million in two rounds of funding.

Another investor, Mr Ravi Kailas, is the promoter of the company and also the Chairman and Chief Executive Officer.

All the three investors together hold around 95 per cent stake in the company, while the rest has been given as stock options.

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