Idea Cellular lowers telecom Capex plan by 17.8% for 2012-13

Telecom Lead India: Mobile service provider Idea Cellular
has lowered its Capex plan by 17.8 percent for FY 2012-13. Lower Capex will affect business of telecom equipment vendors such as Ericsson, Nokia Siemens, Huawei, ZTE, Huawei, Cisco, NEC, etc.

Idea Cellular will reduce its FY 2012-13 Capex to Rs 3500 crore from
Rs 4,250 crore in the previous fiscal.


The planned investment of Rs 3500 crore during 2012-13 does
not include spectrum fee, if any.

The current telecom market uncertainties are forcing mobile operators to plan lower Capex, according to analysts. 


Idea Cellular, in its analyst report, said the company’s 3G
investment plans are on track and high speed broadband services are now
available in 3,000 towns and 10,000 villages, in 20 service areas (including
roaming arrangements).


According to Idea Cellular, the company is confident to
overcome the uncertain regulatory phase, emerge stronger, consolidate its position
in the telecom voice market and participate aggressively in the evolving
wireless broadband business.


Idea currently has around 65,000 km fiber cable transmission
network to tap the future potential of wireless broadband. Idea is also
expanding OFC PoPs and presently has over 1700 PoPs in 128 cities & linked


The fiber network of the company serves 2G/3G/ NLD/ ILD/
ISP/wireless broadband needs. Idea NLD currently carries around 93 percent of
Idea’s captive NLD minutes. Idea ILD currently handles over 95 percent of
captive ILD outgoing minutes, the capacity of which is further being expanded.


The company maintained last quarter trend of free cash flow (after
Capex). The full year cash profit for FY12 stands at Rs 36,079 million. With
declining future Capex demand for

2G and 3G businesses, the Free Cash flow of the company will
provide the cushion to tide over the emerging regulatory challenges.


The Capex and net debt amounts are lower by around Rs. 1.1
billion each due to forex gain on account of rupee appreciation. The Capex of
Rs 9.5 billion (net of de-capitalised forex gain) for the quarter has been
funded entirely out of cash profit of Rs. 10.1 billion.


Idea rolled out 2,553 2G cell sites during the quarter, taking
EoP 2G cell sites count to 83,190, while count of 3G cell sites (Node B)
increased to 12,825 compared to 10,902 in Q3FY12.

The total addition to the Gross Block including CWIP was Rs
8.4 billion for Q4FY12.


Idea won 3G spectrum in 11 important service areas which
cover 75 percent of its existing revenue and account for around half of
national mobility revenue. Idea currently offers 3G services in 20 service
areas (excludes Orissa and Punjab), through a combination of home network and
roaming arrangements.


The company, in its own way, is accelerating the deployment
of 3G ecosystem, by launching Idea branded 3G handsets. Nearly 2.6 million Idea
customers are active on company’s 3G platform and enjoying futuristic services.

Baburajan K
[email protected]