OnMobile Bangalore-based VAS provider OnMobile is planning to enter the capital market this financial year with an IPO of Rs 500-600 crore!

Onmobile is a network-level VAS provider and powers voice portals of most Indian operators. The company is gearing up to become an end-to-end VAS solution provider, intending to invest the IPO proceeds for its foray into the GPRS segment.

According to this ET article, Onmobile’s annual revenues are approx. $50 million (around Rs 210 crore) and the estimated value of the company is approx. $300 million (around Rs 1,250 crore).

Infosys has a 14% stake in the company. Onmobile had secured a strategic financing of $27.8 million (around Rs 115 crore) from Deutsche Bank, Goldman Sachs and Polygon Investment Partners late last year. This was the second round of funding for the company following its $18 million (around Rs 73 crore) first round in 2000 secured from Argo Global and HNQ Asia-Pacific.

The company’s competitors include IMI Mobile, Cellebrum and Mauj.

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Idea Cellular Hindu Business Line’s stock analyst K. Venkatasubramanian puts a “Hold” call on the Idea Cellular stock.

Some interesting tidbits for the rest of us non-investors.

  • In the 11 circles it operates in, eight are profitable, while in three where it started operations recently

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Reliance Communications reported a net profit of Rs 702 crore for the second quarter of FY 2006-07, as against a loss of Rs 19 crore in the year-ago period. The company saw 40% revenue growth at Rs 3,526 crore.

The EBITDA, at Rs 1,353 crore, marks a growth of 216% over the corresponding quarter last year, while EBITDA margin expanded to 38% from 17% during the period.

RCL added 3.5m wireless customers (net) during the second fiscal quarter, more than double the net additions of 1.6m in the corresponding period last year. Revenues of the wireless business increased 44.7% from Rs 1,778 crore to Rs 2,574 crore. Its quarterly capex for the wireless business was Rs 1,499 crore, while the per minute revenue was maintained at 77 paise.

Its market capitalisation has reached over Rs 80,000 crore, while that of its nearest rival, Bharti Airtel, stood at nearly Rs 1,02,700 crore on October 30.

Subex Azure has reported its consolidated profit for the second quarter ended 30 September 2006 at Rs 17.1 crore, up 356% from Rs 3.7 crore in Q1.

Net consolidated revenue was at Rs 103.1 crore, up 137% from Rs 43.4 crore in Q1. Product revenue was at Rs 74.1 crore in the current quarter, up 252% from Rs 21 crore in the last quarter.

Subex Azure is a provider of revenue maximisation solutions for telecom operators. It acquired UK based Azure, the largest player in the revenue assurance space in May this year.

Sasken Communication Technologies has reported a consolidated Profit-After-Tax for Q2 of Rs 11.88 crore, up 37% QoQ. Its consolidated revenues for Q2, are Rs 117.55 crore, up 29% QoQ.

Sasken recently acquired Finland based wireless R&D and testing services company Botnia Hightech Oy for Euro 35.5 million. The total employee strength was 3,373 and total customers are 53 as on 30 September 2006.

Sasken is an embedded telecom solutions company that helps businesses across the telecom value chain accelerate their product development life cycles. Sasken works with terminal device manufacturers, network equipment manufacturers, semiconductor vendors and network operators.

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Bharti Airtel Q2 net profit rose 23.7% at Rs 934 crore in the second quarter versus Rs 755 crore in the previous quarter. Its revenues were up 13% at Rs 4,357 crore from Rs 3,856.3 crore QoQ. The EBITDA stood at Rs 1,702 crore.

The consolidated total revenues grew by 61%, EBITDA grew by 67% and the net profit grew by 79% on a year on year basis.

The company made net additions of 4.1 million users in Q207 followed by 3.49 million in Q107 and 3.23 million in Q4. Bharti had over 2.86 crore customers, as on September 30, 2006.

The numbers were ahead of street expectations.

Tech Mahindra announced a 373% growth in net profit after tax and 183% increase in revenue for Q2 FY07 over the corresponding quarter in the previous year.

The company’s cash and cash equivalents were Rs 452.5 crores as of September 30, 2006.This includes Rs 116.3 crores raised in the initial public offering of the company.

  • Net profit after tax of Rs 177.1 crores and revenue of Rs 697.7 crores
  • Over the previous quarter, net profit after tax grew by 66% and revenue grew by 19%
  • Headcount crosses 15,000 mark

MTNL reported net profit of Rs 121 crore in the second quarter versus Rs 131.3 crore in the previous quarter. Its operating revenues decreased to Rs 1,220 crore from Rs 1,278.2 crore. The EBIDTA was seen flat at Rs 287 crore versus Rs 285 crore.

Also Read: Bharti gives MTNL blues

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Idea Cellular, the fourth largest GSM operator in the country, is planning an initial public offer for raising about Rs 1,400 crore – Rs 1,800 crore .

Birlas are open to divesting around 25% and may also place 8-10% with a private investor before the IPO. It also plans to cut Aditya Birla Group’s stake in Idea to 55.3% from the present 98.3%. DSP Merrill Lynch and JM Morgan Stanley have been appointed as lead managers to the issue.

The operator had initially intended to place 33% with private investors and was in serious discussions with the Blackstone group, Providence Equity Partners and a couple of others. But they were unable to agree on the valuation and the company was now looking at an IPO, sources said.

Idea Cellular was a joint-venture between the Tatas and the Birlas. The Birlas bought out Tatas’ 48% stake for Rs 4,406 crore in April this year.

On a turnover of Rs 2,989 crore, the company has seen its profits rise by 179% to Rs 212 crore for fiscal 2006. The management hopes that the company will be valued upwards of Rs 10,000 crore.

Idea Cellular needs funds to expand operations and is planning to roll out services in Rajasthan, Himachal Pradesh and Eastern UP by this year-end and enter the Mumbai market around mid-2007. Idea has a presence in Maharashtra, Gujarat, Madhya Pradesh, Andhra Pradesh, Delhi, Kerala, Haryana and Western UP. It is India’s fourth largest mobile operator with 9.7 million subscribers.

Bharti Airtel, Reliance Communications, MTNL and Tata Teleservices (Maharashtra) are the other listed services providers. Hutch has been harbouring plans to enter the primary market for some time now.

Valuations in the telecom sector have appreciated 30-40% since the stake sale between the Tata group and the Birlas was completed in June. Bharti Airtel, the largest cellular services player in the country, is currently trading at Rs 469, which is nearly 30% higher than its last traded price in June. Reliance Communications, the second largest listed player, is currently trading at Rs 347, 40% higher than its last traded price in June.

Sources: Financial Express and NDTV Profit

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ET reports that MTNL’s operating profit for the year ’05-06 (Rs 166 crore) has become a fifth of the operating profit in ’04-05 (Rs 760 crore). The PSU had registered a net profit of Rs 580 crore for FY05-06, as compared with Rs 938 crore in the previous fiscal.

  • The profits of MTNL are being sustained only through other income. Other income went up to Rs 530 crore due to interest on refund of income tax deposited in the previous years, as against Rs 491 crore in ’04-05.
  • However, it more than doubled the cellular subscribers. Revenues from GSM services went up from Rs 287 crore to Rs 561 crore.
  • Income from core telecom services fell by Rs 22 crore to Rs 5,560 crore in ’05-06.
  • The growth in respect to braodband subscribers is still sluggish. Broadband subscribers increased to 211,935 during FY05-06.
  • Fixed line subscriber base fell to 3,821,252, as against 4,015,173 during

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Sasken Bangalore-based Sasken Communication Technologies is all set to announce an acquisition in the next 45 days.

President and COO Srikanth Kannankote, declined details but said that the company needs to establish a base in North America. The acquisition is likely to be in the area of handset technology or infrastructure services.

Sasken has charted an expansion plan, both organic and inorganic, to leverage the global delivery model across geographies.

The company is planning to set up a small development centre in China soon.

“We have to be in China if we want to be a tier I player. The Chinese market is huge with a lot of telecom players.
Our idea is to open a small centre there and grow with our anchor customers, similar to what we are doing in Mexico,

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Whether its through Private equity or Primary market, money is pouring into the telecom industry.

The IPO of Tech Mahindra (formerly Mahindra British Telecom), a provider of IT solutions to telecom companies, was oversubscribed 72 times when it closed on August 4.

Tech Mahindra is one of the top 10 software exports companies in India. It was ranked eighth largest in terms of export revenues as per Nasscom 2005.

It entered the IPO market with a public issue of 12,746,000 equity shares of Rs 10 each in the price band of Rs 315- 365 per equity share.

The company has registered a 31% revenue growth as compared to its revenues the year before.

The revenue for the year ended March 31, 2006 grew to Rs 1242.7 crore (Rs 12.42 billion), from Rs 945.6 crore (Rs 9.45 billion) for the year ended March 31, 2005.

Profit after tax also grew by 130%, from Rs 102.4 crore (Rs 1.02 billion) for the year ended March 31, 2005 to Rs 235.4 crore (Rs 2.35 billion) for the year ended March 31, 2006.

Source: Moneycontrol

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Bharti Airtel Ltd., beat quarterly profit forecasts as its first-quarter net profit rose 48% to Rs 755 crore.

Total revenue increased 53% to Rs 3856 crore in the first quarter. It has posted an EBITDA of Rs 1502 crore, a YoY increase of 60%.

It had the highest ever net additions of 36.51 lakh customers in a single quarter. Wireless services accounted for 74% of first quarter sales.

Monthly ARPU slipped marginally to Rs 441 rupees from Rs 442 in the last quarter, but minutes of usage surged to 441 versus 431.

As operators sign-up the next set of users, the price-sensitive segment in urban market and the rural populace, ARPUs are expected to decline further. Its good to know that there is no steep decline in ARPU of Airtel subscribers and that it has managed to contain the decline in the last quarter.

The company’s networks cover 46% of the population. It has a presence in 4,026 towns and 101,614 villages.

Bharti has a market capitalisation of nearly $15 billion. Speaking to CNBC-TV18, Rajen Shah of Angel Broking comments on the company’s stock:

“So the results have been good and the management expects the margin to continue at the same level in the coming quarters and based on the first quarter numbers Bharti could easily report earnings of about Rs 17 for the current year, which translates into a PE of about 22, which is reasonable for Bharti. I don’t expect any major upside from the current levels in Bharti.”

Visit the company’s website for more earnings details.

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Announcing its second quarter results yesterday, Motorola posted all time high mobile device sales this quarter, including record operating earnings from devices.

The company’s sales increased 46% to $7,140 million while its operating earnings rose 62 per cent to $799 million.

Motorola has retained its second position in India and world wide, while expanding its global market share to 22% in the second quarter this year. The company also expanded its market share to more than 20% in China, up 8.9 percentage points from the year-ago quarter.

Nokia, the world’s largest maker of mobile phones, said second-quarter profit gained 43% while net income rose to $1.44 billion. Sales rose 22% to $12.24 billion from $10.1 billion.

Analysts are of the opinion that handset sales in China and India were likely to have boosted the companies’ earnings.

While Motorola’s earnings have beat estimates, those of Nokia are largely seen as reflecting stagnant growth in the industry. Bloomberg article has more details.

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