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Axiata Group Berhad | Annual Report 2016
OPERATING COMPANIES BUSINESS REVIEW
046
Outlook for 2017
Moving into 2017, Ncell is committed to
maintaining its leadership position in the
Nepalese mobile market by continuously
providing superior customer experience through
network expansion and modernisation, as well
as the introduction of an innovative range of
products and services.
The Company’s key focus will be on
generating sustainable revenue streams by
maintaining voice segment growth, stabilising
the international long distance business and
aggressively driving growth in data revenue
contribution. Introduction of 4G services in the
future as well as data-led pricing will enable the
company to enhance its data leadership position
in the market as well as gaining competitive
advantage amidst rapid shift in the consumption
pattern from voice to data.
In 2017, Ncell will place greater emphasis on
sustainably generating its next wave of growth
via digital services offerings and developing
the ecosystem to support it. The Company
will also focus on the digitalisation of its core
functions to increase operational efficiency and
effectiveness. The resultant effect would be
a more robust delivery chain, better equipped
to face continuous market pressure on its
profitability.
Key Highlights
• 6th largest mobile operator
globally by subscriber base, with
over 185 million subscribers
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• Pan-India 3G & 4G networks
reaching 500 million Indians
• Roll out 63,000 sites in 2016
• Mobile Number Portability
leadership with 20.7 million net
subscribers gain
• In-principle approval from Reserve
Bank of India to launch Payments
Bank
About Idea
Idea, an Aditya Birla Group Company, is a pan-
India integrated wireless operator offering 2G,
3G and 4G services, with National Long Distance
(NLD), International Long Distance (ILD) and
Internet Service Provider (ISP) operations. Idea
is one of the top three mobile operators in India,
with an annual revenue in excess of USD5 billion
and a revenue market share of 19%. With nearly
200 million subscribers, Idea ranks sixth in global
rankings of operators in terms of subscribers for
a single country operation.
In line with the Government’s vision of Digital
India, Idea has accelerated its efforts in building
a digital economy. Idea has embarked into digital
services, having begun its transformation from a
pure play mobile operator to an integrated digital
services and solutions provider, and expanded
its digital offerings to digital communications,
digital payments, Cloud and storage, digital
information and more.
Idea’s pan-India mobile voice network covers
over one billion Indians across 400,000 towns
and villages. As at end December 2016, Idea’s
network comprised 230,000 sites and over
128,000 km of optical fibre.
Idea provides world-class service delivery
through the most extensive network of customer
touch points, comprising of 8,780 exclusive
Idea outlets, call centre, digital app and social
media. Idea’s commitment to providing superior
customer experience led to the company
achieving No. 1 ranking in market research firm
Forrester’s ‘Customer Service Index 2016’.
Idea has consistently retained its leadership
position in Mobile Number Portability (MNP),
continuing to grow its MNP net gain to 20 million
subscribers.
Business Review 2016
In 2016, the Indian telecom sector achieved the
milestone of one billion mobile subscribers, an
instrumental development to get Indians tomove
towards a digital economy as demonetisation
marked the closure of the year in the country.
In line with the Government’s vision of Digital
India, Idea accelerated its efforts of building
a digital economy by catalysing wireless
broadband penetration. During the year,
Idea achieved pan-India wireless broadband
capability with an investment of INR130,000
million in spectrum acquisition in October 2016.
The Company has also invested in expanding
its network infrastructure across the country. In
2016, Idea rolled out 4G at an accelerated pace,
setting up nearly 63,000 sites.
With a spectrum availability of 900 MHz across
TDD and FDD bands, Idea is geared with
substantial spectrum capacity required to meet
data capacity needs for its customer base. The
Company also launched Digital Idea, a suite of
lifestyle apps which enables customers to enjoy
a range of digital entertainment and content.
Idea's market penetration in rural areas has
enabled it to offer mobile broadband services
to new market segments, and the Company has
been consistently propagating the benefits of
mobile Internet to rural Indians through digital
awareness and marketing activities.
In 2016, Idea launched its Internet4All campaign
which resulted in 22 million hits where free data
credit was given to nearly five million non-data
users.
Idea’s commitment to providing superior
customer experience across all touch points
enabled it to achieve lead ranking of number
one position in customer service by market
research firm Forrester in its Customer Service
Index 2016, the only mobile service provider to
do so.
In spite of the disruptions brought on by the
entry of a new operator in the market last year,
Idea retained its leadership position in MNP,
continuing to grow its MNP net gain to 20 million
subscribers.
Financial Performance
For the nine months ending 31 December 2016,
Idea reported Year to Date revenue growth of
3.6%. EBITDA was INR80,798 million, compared
to INR94,139 million the previous year. Idea
suffered a Loss After Tax of INR720 million.
Outlook for 2017
The Indian mobile industry witnessed
unprecedented disruption in the last quarter
of October to December 2016, primarily due
to free voice and mobile data promotions by
the new entrant in the sector. Consequently,
revenue, Key Performance Indicators (KPIs) and
financial parameters for all mobile operators have
sharply declined. For the first time in its history
the flourishing Indian mobile sector is trending
towards an annual revenue decline of between
3% and 5% in 2017, compared to 2016, for the
year ending 31 March 2017. The sector can expect
to recover revenues only once the new operator
starts charging for its pan-India mobile services.
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As at end December 2016
BUSINESS REVIEW