Idea spreads 4G footprints across India

The third largest wireless operator in India, Idea Cellular (Idea) informed stock exchanges on Thursday that it has launched its high speed 4G Long Term Evolution (LTE) services in 3 more telecom service areas( 4 more states). It has expanded its services in Madhya Pradesh & Chhattisgarh (MPCG); Punjab and Haryana. With this Idea will now offer its services in 7 circles across India, including the 4 telecom circles of South India, namely Andhra Pradesh & Telangana; Karnataka; Kerala; Tamil Nadu & Chennai, a project launched on 23rd December 2015.

Idea’s 4G LTE services will be available across 183 towns in these 7 telecom service areas by 31st January 2016, and it will roll out 4G Services in remaining 3 Telecom service areas by March 2016. It is expecting to expand its 4G footprint across 750 towns by June 2016 in 10 Telecom circles. The next 3 key markets namely are Maharashtra & Goa; North East; and Orissa. Idea currently holds 1800 Mega Hertz (MHz) of 4G spectrum in these 10 Telecom circles, which cover 50% of telecom market, and adds up to over 60% of Idea’s gross revenue.

Additionally, Idea has recently signed an agreement with Videocon Telecommunications for acquiring ‘Right to Use’ 1800 Mhz spectrum, under ‘Spectrum Trading Agreement’ in two of its key telecom leadership markets of Gujarat and Uttar Pradesh (West) for Rs 3310 crores. Post completion of this transaction, 4G services will be extended to 12 service areas, covering 75% of Idea’s revenue base in the country.

Idea has 2.7 million 4G devices, nearly 4% of its subscriber base in these 7 telecom service areas, registered on its network. In comparison, on an All India basis, Idea has nearly 49.5 million customers owning 3G devices and over 6 million customers having 4G devices.

On financial front, the total consolidated operating revenue of Idea for FY15 stood at Rs 31571 crores, an increase of 19.44 percent compared to Rs 26432 crores in FY14. EBITDA is at Rs 10812 crores,  an increase of 31.10 per cent from FY14; and EBITDA margin stands at 34.25 per cent for FY15, compared to 31.20 per cent in FY14. The net profit for FY15 stood at Rs 3193 crores, an increase of 62.26 per cent on a yearly basis.

This wide network coverage across India will help company on the financial front in improving further revenues, and also to become indispensable in the cut throat competition driven by the impending arrival of deep pocketed Reliance Jio. The stock of company is trading at Rs 121.15, an increase of 1.46 per cent from the previous close.