Bharti sees capex of $850 m in 2005-6

Muralikumar Anantharaman

SINGAPORE: India's top listed mobile phone company, Bharti Tele-Ventures Ltd., will spend up to $850 million in the year ending March 2006 to almost double the number of towns it covers, its chairman said.

"Next year again, we are going to go in for a major expansion. Our plan is to take it (coverage) to over 5,000 (towns) by next March," Bharti Chairman Sunil Mittal said.

Bharti, 28-percent-owned by Singapore Telecommunications Ltd., is spending about $850 million in the current fiscal year ending March 31, 2005 to increase its mobile services coverage to about 2,600 towns, Mittal said.

"We'll spend, I would say, $800-$850 (million), thereabouts," said Mittal, adding that the investments would be funded internally.

He said the firm was faring well in the current quarter.

"This quarter is looking good. Growth of customers is good."

Bharti's customer base is now about 11 million, with the number of mobile subscribers having crossed the 10-million mark, the chairman said.

Its mobile subscriber base had grown by 79 percent in 2004 to 9.83 million users. The total number of subscribers, including fixed-line, had risen 75 percent to 10.63 million.

New Delhi-based Bharti is expected to more than double its full-year profit to about 13.5 billion rupees according to Reuters Estimates, as mobile sales surge in Asia's fourth-biggest economy.

An early entrant in India's wireless market, Bharti is enjoying booming demand in a country where fewer than five in 100 people own a mobile phone compared with more than 25 in 100 in China.

Mittal said he has not had any discussions with SingTel on the Singapore firm raising its stake in Bharti after India raised the foreign investment cap in telecoms firms on Wednesday to 74 percent from 49 percent.

The subject was also "not on the agenda" of his planned meeting with SingTel, he said.

"We were always wanting to have more liberty to access capital. So this (the government move) gives us the wherewithal to raise capital and whenever the time is right, we will do something."

"We are very clear that we will be raising capital from the markets," he said.

Bharti shares rose 0.16 percent to end at 219.40 rupees on Thursday, valuing the firm at around $9.3 billion. The benchmark Bombay index closed 1.4 percent higher.