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India: Telenor to limit funding for Indian operations

2013/01/16

Scandinavian operator Telenor has scaled back its Indian unit, stating that it intends to spend no additional than INR155 billion (US$2.85 billion), with the goal of recouping this amount by the end of Q4 2013.
The operator’s CEO Jon Fredrik Baksaas said: “The decision by India’s Supreme Court in February to revoke amount our licenses took the entire industry by surprise and we were faced with an intense period of uncertainty for the next 10 months.” Next taking the decision to acquire new licences in the recent spectrum auctions, Telenor has presently established its “strategic direction and financial objectives” for the Indian market.


Telenor entered the Indian market via a joint venture with Unitech, but the licences it held for 13 of India’s 22 telecom circles were cancelled by the Indian Supreme Court next the issue process was ruled invalid. In the new auctions, the operator limited its bidding to the six circles which had produced the best results for its previous operations.
The firm stated: “The Indian operations by presently enjoy decent market positions in terms of subscriber and revenue market share in amount six circles and [we] plan to further improve this in the coming years by taking a number 2-3 position in the clusters where we are present”, adding that its goal is to be “best in mass market distribution, best in servicing basic [and] best in low cost operations.”
Currently Telenor has only broken even in one circle – Uttar Pradesh East – but is on course to recoup its spend on both Gujarat and Maharashtra in Q1 2013.

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