Uninor expects operational profits in two years

Hyderabad: Telecom services provider Uninor on Monday said it expects Indian operations to make cash profits in the next two years, after it achieved break-even in 2013.

Vivek Sood, Chief Executive, Uninor, indicated the Norwegian firm may invest Rs 500 crore during the current year (January-December) towards capital expenditure.

"So far we have invested Rs 17,000 crore to Rs 18,000 crore in India which includes towards the licences which were cancelled (by a Supreme Court order in 2012). In a year or two we will be making cash profits positively, by 2016 or 2017," he said.

He was responding to media queries about profitability of the company.

Uninor's subscriber base, currently at 42 million, is expected to touch 50 million during the current year, he said.

"We don't give our numbers on targets and forecast. We will continue to invest on our expansion. It would be pretty much as last year (Rs 500 crore).

"We don't have cash flow break-even yet. So we need to borrow money. Whether Telenor supports or we take it locally, we need to make that decision," he said when asked about capex plans for the current year.
Sood said Uninor's Telangana and Andhra Pradesh circles expanded their network by adding 624 sites. The expansion gives Uninor a much deeper coverage and better service experience.

"Uninor has over 4.5 million subscribers in Telangana and Andhra Pradesh. This makes it No 6 operator in the market. To serve customer better the company has 200 branded stores and 60,000 points of sale (POS)."

Uninor reported 38 percent year-on-year improvement in gross revenue in third quarter of current fiscal. The company's average revenue per user or ARPU (a key indicator of source of revenue and margin growth) also went up 4.4 percent Y-o-Y in third quarter, he said.

In the last 12 months, Uninor has added over 10 million new subscriptions in its six circles. It acquired a new circle -- Assam -- in 2014 auction along with additional spectrum in four of its existing areas of operation.

Preparations are underway to launch operations in Assam circle later this calendar year, Sood said.