Is MTS looking at LTE / 4G in India by investing $415 million in 2013?

Thursday, 11 April 2013 05:27

Sistema Shyam TeleServices (MTS India) is planning to invest $415 million in India in 2013 and a part of this will be on developing faster wireless services using LTE / 4G technology.

The company will invest $415 million to address interest costs, capital expenditure, covering losses and possibly developing faster wireless services using LTE technology, MTS said on Tuesday.

Its total investment in Indian telecom market will be around $1 billion between 2013 and 2015.

The new spectrum in 8 circles — Delhi, Kolkata, Gujarat, Karnataka, Tamil Nadu, Kerala, Uttar Pradesh (West) and West Bengal — will enable the telecom operator to launch 4G / LTE services.

Significant investment in 4G / LTE will enable Sistema Shyam to improve data card subscriber growth that declined 2 percent to 1.78 million subscribers for the fourth quarter.

Videocon Mobile Communications, which won 2G licenses in the  November 2012 auction, is following the 4G / LTE route to enhance its customer offerings.

Sistema Shyam TeleServices, which is reducing its presence to 9 circles from the earlier 23, will address 40 percent of country’s population, address around 60 percent of data potential and also safeguard 75 percent of the company’s current revenues.

During the auction of 3G and BWA spectrum in 2010, Sistema Shyam TeleServices did not buy any spectrum. Hence, using the 2G spectrum for launching 4G services will be cost effective for the operator which is a joint venture between Sistema of Russia and Shyam Teleservices.

Despite telecom regulatory challenges, the investments made by SSTL in India at the end of 31 December 2012 stands at Rs 6568 crore. It includes investment of Rs 18.2 crore during Q4 2012. Consolidated debt from banks and financial institutions at the end of 31 December 2012 stands at Rs 56.7 billion.

Sistema, the Russian conglomerate, had written off about a third of its $2.8 billion investment in Indian mobile services.

Last month, Russian mobile service provider MTS said it is likely to spend around $2.6 billion as Capex (capital expenditure) in 2013.

Apr 10, 2013

Telecom Lead Asia

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