Posts filed under ‘Essar’
Vodafone Essar, the UK-based group’s Indian subsidiary, is in the process of a raising a INR100 billion (USD2 billion) bridge loan to finance its participation in India’s forthcoming 3G spectrum auctions. According to banking sources, Vodafone has appointed SBI Capital Markets to arrange the loan from a range of banks. “Canara Bank has approved INR7.5 billion for Vodafone, and the rest of the money will come from other banks,” a source said. An unnamed Vodafone source added that the financing would also be used for network expansion. However, Vodafone Essar declined to offcially comment on the story.
According to the report, there is still no official date for the start of India’s long-awaited 3G auctions, which are now thought unlikely to happen prior to India’s general elections, which need to take place before May. A Mumbai-based telecom analyst added that Vodafone would have little trouble raising the INR100 billion, suggesting that the operator should be able to secure an interest rate of around 8.5 percent. India is a key market for Vodafone, accounting for around 65 percent of the 9.7 million net new customers it added in its most recent.
Vodafone, the UK-based mobile group, has revealed a year-on-year increase in revenue to GBP10.47 billion (USD14.97 billion) for its third fiscal quarter ended 31 December 2008, citing a boost in exchange rates as a key factor in the rise. However it reported that quarterly revenue had fallen 1% on an organic basis. Organic revenue from the group’s European subsidiaries fell 1.4%, and while results had stabilised in the UK, and had been solid in Germany and Italy, the company’s Spanish arm saw a decline of 5.8% in organic revenue, faster than the previous quarter. Group-wide, revenue from data services increased 25.3% year-on-year to GBP786 million, and accounted for 8.13% of total revenue, up from 6.44% a year earlier.
Additionally, having announced a cost-saving programme in November 2008, Vodafone claimed it had made good progress with the plans and revealed that it expected to have saved approximately GBP500 million by the end of the 2010 financial year, rising to GBP1 billion by 2011. As a result of foreign exchange movement the group has revised its full year guidance, increasing its revenue target to GBP40.6-41.5 billion, whilst adjusted operating profit is expected to be between GBP11.5 billion and GBP12 billion.
The group reported a rise of 9.5 million in its total mobile customer base to 289 million at the end of December 2008. It recorded record customer growth at its Indian subsidiary, Vodafone Essar, adding 6.3 million subscribers over the quarter, bringing its total to just over 60 million.
Idea Cellular Limited (Idea) announced its unaudited results (limited review) for the 3rd quarter (Q3) and nine months ended December 31, 2008.
Revenues for Idea’s 13 operating service areas for Q3 at Rs. 26,209 mn, grew by 13.9% on a QoQ basis and by 53.2% on a YoY basis.
The EBITDA for the 11 Idea service areas in Q3 enhanced to Rs 7,570 mn compared to Rs 6,446 mn in Q2, representing a margin improvement from 28.1% to 29.4%. However, Q3 captures the impact of Mumbai and Bihar launches for the entire quarter, whereas Q2 had the impact only of Mumbai for 5 weeks. Consequently, Total EBITDA margin declined marginally from 26.4% to 26.0%, even though Total EBITDA increased by 11.9% from Rs 6081 mn in Q2 to Rs 6,805 mn in Q3.
On a consolidated basis, Revenues for Q3 at Rs. 27,311 mn, grew by 18.5% on a QoQ basis. The EBITDA at Rs 6,974 mn showed a growth of 14.9% on a QoQ basis. Consolidated PAT for Q3 was Rs 2,195 mn as against Rs 2,562 mn on a standalone basis. The consolidated PAT is depressed by Rs 367 mn on account of the consolidation of Idea’s 41.09% shareholding in Spice Communications from 16th Oct 08 and on account of Idea group’s 16% shareholding in Indus Towers.
On 5th Dec 08, an affiliate of Providence Equity Partners has invested Rs. 21 bn in Aditya Birla Telecom Limited (ABTL) by way of subscription to 1.925 mn Compulsorily Convertible Preference Shares to be converted into 16.14% of equity share capital of ABTL post conversion.
Idea, including service areas of Punjab, Karnataka and Bihar, added 4.03 mn subscribers during Q3 taking its subscriber tally to 38.01 mn, reflecting a national market share of 11.0%.
Idea, along with Spice and ABTL, now holds GSM spectrum for every service area in India.
India’s largest mobile operator Bharti Airtel said on Thursday that it would invest about USD 3.5 billion in the next fiscal in telecom operations and in rolling out passive infrastructure. Bharti also said that it is on track to spend the same amount in the current fiscal.
“On mobile telecom operations-side the investment would be about USD 2-2.5 billion and the tower business-side between Bharti Infratel and Indus we should be spending between 2.5 and USD 3 billion in FY10. But in Indus (which is a tower tripartite venture of Vodafone Essar, Idea and Bharti) we have 42 per cent share so the exact investment in the tower business will come down to USD one billion making it the same as last year’s capex of USD 3.5 billion,” Bharti Enterprises MD Akhil Gupta said in New Delhi.
Overall capital expenditure will be USD 3.5 billion ballpark, but we will know the exact amount by the end of the next quarter, he said.
He said the company need not raise any funding for mobile operations but in the tower companies — Bharti Infratel and Indus — there will be a need to raise debt to fund the expansion.
While Indus has 93,000 towers, Bharti Infratel, which is a wholly-owned business of Bharti Enterprises, has 30,000 towers. Overall, Bharti’s share comes to 61,000 towers on a proportionate basis as it holds 42 per cent in Indus towers.
“Both will require debt funding,” he said but did not share the amount saying it is competitive information. Whatever required would be raised on need basis. Our net debt is very low — net debt to equity is just 0.19.”
Gupta ruled out any further stake sale for the moment in Infratel, which already has global investors like KKR, Singapore government’s investment arm, Temasek Holdings and other leading global investors hold about 10 per cent stake in Bharti Infratel.
New York-based private equity (PE) firm Kohlberg Kravis Roberts and Co (KKR) has invested USD 250 million (Rs990 crore) in Bharti Infratel Ltd. The arm attracts an enterprise valuation of the company of USD 12.5 billion.
“We raised some money last year from selling Bharti Infratel stakes… there is immediate plan to monetise its assets further,” He said.
He said Bharti did bid for the Iran license and it lost which ultimately went to Etisalat. “Either they were too aggressive or we were too mild,” he said. Bharti Airtel shares were trading at 4.87 per cent higher at Rs 612.
The Telecommunications Regulatory Authority of India (TRAI) disclosed that GSM operators Bharti Airtel and Vodafone Essar have the busiest telecom networks in the country, after conducting an analysis.
This aspect was being recorded by TRAI on a monthly basis across the country. The regulator stated the congestion levels were way above the permissible limit during the quarter ended September 08 in as many as 129 places. Nevertheless, the overall congestion levels which was as high as 526 in 2006 came down to 134 places in the quarter ended June 2008.
The congestion besides causing call drops and deterioration of voice quality, also forces consumers to make repeated attempts to get through to another subscriber.
The regulator has a set a benchmark of less than 0.5% for the congestion levels indicating that out of 200 calls between two operators only one call should face congestion problem. This level is tracked by TRAI by evaluating the congestion levels at the Points of Interconnection (PoI), which are the places where mobile traffic is exchanged between the networks of different operators.
Bharti Airtel has the largest number of PoI’s having a congestion of 41 followed by Vodafone with 22. Reliance Communications and Idea has 19 each. The circles most affected due to network congestion are Bihar, Maharashtra, Gujarat, Mumbai, Uttar Pradesh (West) and Himachal Pradesh.
India’s telecom sector has reportedly added 10.35 million mobile subscribers in the month of November, in comparison to 10.42 million in October. The subscriber base of mobile users in India reaches the mark of 336.08 million at the end of November, the Telecom Regulatory Authority of India said in a statement.
Bharti Airtel, country’s leading mobile operator added 2.72 million users in November, totalling its subscriber base to 82.92 million. Followed by Reliance Communications which added 1.76 million users and took its subscriber base to 59.56 million subscribers. Vodafone Essar added 20.60 million users, taking its total number of subscribers to 58.76 million. BSNL’s reported a subscriber base of 44.57 million after adding 700,937 subscribers in November.