Business Daily from THE HINDU group of publications
Tuesday, Aug 28, 2007
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Business Daily from THE HINDU group of publications Tuesday, Aug 28, 2007 ePaper |
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Telecommunications Info-Tech - Diversification Parsvnath Developers entering telecom sector
Special purpose vehicle to be formed for the venture Renowned mobile operator to be strategic partner Move will put pressure on Government with regard to spectrum allocation
Mr Pradeep Jain, Chairman
Our Bureau New Delhi, Aug. 27 The beeline to acquire a new licence for offering mobile services in the country has just got longer. Real estate developer Parsvnath Developers Ltd on Monday said that it is forming a special purpose vehicle to foray into the mobile services space. The company has submitted applications to the Department of Telecom for providing unified access service in 22 telecom circles across the country. Mr Pradeep Jain, Chairman and Managing Director, told Business Line that the Group will hold at least 26 per cent stake in the SPV. He said that a “renowned” mobile operator will be the strategic partner in the venture. Mr Jain refused to divulge the details of the partner or the investment planned. He, however, said that the company is seeking to foray into the GSM cellular segment and is hoping to fructify the project during the next fiscal year. “This is a great opportunity for the company to diversify into a new business area, which is continuously growing. Despite increasing number of subscribers, the penetration of mobile telephony in India is still low compared to developed countries. As and when number portability is introduced, it would offer immense business opportunity to new entrants,” Mr Jain said. Spectrum crunch
Parsvnath’s application will put further pressure on the Government, which is finding it difficult to make available adequate spectrum for existing operators. Mobile service providers including Idea Cellular, Spice Telecom and Aircel are awaiting spectrum in new circles. Existing pan India operators such as Airtel and Vodafone have also applied for additional radio frequency to meet the growing subscriber base. In addition, DoT has a backlog of more than 50 applications for new licences from companies including Himachal Futuristic Communication Ltd and Switzerland-based ByCell. Ceiling on operators
One of the options being considered by the Government is to cap the amount of spectrum allocated to each operator and auction the remaining frequency, which would enable new applicants such as Parsvnath to bid for spectrum. “With the Government following an open policy on spectrum, Parsvnath seeks to use this opportunity for providing unified access service on a pan India basis, including rural telephony. The licence for unified access service would entail a 2G licence for GSM and a triple play of various services such as IPTV, Wi-Max, internet, broadband and any other services relating to the signal,” said a company press release. The company has recorded consolidated revenues of Rs 1,534.5 crore and a consolidated net profit of Rs 292.21 crore in fiscal 2007. Parsvnath’s share price on the Bombay Stock Exchange was up by 5.3 per cent at Rs 294 per share.
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