Idea Cellular now has operations across all the 22 circles in the country, after it won spectrum in eight circles in November 2012, including seven zones where it had lost licences.
For the Aditya Birla group company, regaining its pan-India presence is extremely important, according to its Managing Director Himanshu Kapania. He also said the GSM operator would adjust tariffs, as overall industry call rates rise. Excerpts from an interview:
We are waiting for the final guidelines on roaming, because there are a lot of linked issues. First and foremost, licences are not nation-wide, but issued on a circle basis. So, value of each circle is different, and how can we have a single tariff across all the circles?
We are also waiting to see how operators, who don’t have pan-India footprint, will be able to offer the services. These would also impact NLD (national long distance) operators, as there are carriage charges.
Who will bear these charges?
These issues have to be addressed before we can come to a conclusion.
But will the tariffs go up, as operators would lose some revenues?
I think this is a misnomer. Our understanding is that the local tariffs and roaming tariffs would be the same. It’s not roaming free.
Mobile number portability was launched in India in November 2010, but has it been a game changer?
Every subscriber is not a dissatisfied customer. And it’s unfair to presume that all 900 million customers are dissatisfied. The choice is in the hands of the consumer, but then it shouldn’t be considered a failure.
Idea Cellular is now a pan-India operator again…
We are excited about it, for us the pan-India operations are extremely important. That’s why we have made a very significant investment in a brand campaign (‘Honey Bunny’), to tell that we are a pan-India operator. We will continue to launch new tariffs and schemes, and value service to our customers.
Idea Cellular’s net debt at Rs 11,682 crore is lowest among the listed players, and among the lowest in the industry…
We have always maintained that telecom operators need to have a strong balance sheet and we remain focused on one important financial parameter: net debt to EBITDA. We remain committed to keep it on an average 2-2.5 per cent. We won’t stretch our balance sheet beyond that.
Why is there a revision of capex for the financial year to Rs 3,000 crore from Rs 3,500 crore?
We had about Rs 500-crore incremental capex that was kept for new circles, but we could not have made that investment until the (spectrum) auction was completed. Now, we are waiting for licence issuance. So, these investments would be moved over to the next financial year.
Are you also looking at tariff hikes, as most companies are bleeding and there is no other way than hiking call rates?
We are waiting to see what the lowest tariff operators do. They are the one who have to raise the tariffs. As the overall industry prices goes up, we will accordingly adjust our tariffs.
On Indus Towers (the three-way joint venture between Bharti Airtel, Vodafone India and Idea), do you expect revenues from infrastructure business?
In the long run, Indus is a steady source of business, as tower companies will remain a steady source of business with predictable revenues.