Hutchison Telecom turns profit on India growth

HONG KONG:  Hutchison Telecommunications International Ltd., the emerging markets phone arm of tycoon Li Ka-shing's Hutchison Whampoa Ltd., turned a first half profit as its fast-growing India unit offset start-up costs at its new operations in Indonesia and Vietnam.

Hong Kong-based HTIL, which wants to position itself as a dominant mobile player in developing markets, has been an avid dealmaker, although its hopes to list its India business have been delayed in part by changes in regulations and the operation's ownership structure.

HTIL, which also has operations in Hong Kong, Thailand, Israel, Macau, Ghana and Sri Lanka, said on Wednesday that its profit attributable to shareholders for the six months through June totalled HK$2 million, compared with a loss of HK$370 million a year earlier.

The company said its profit for the period was HK$644 million (US$82.6 million), compared with a loss of HK$220 million a year earlier.

Turnover rose 48 percent to HK$15.67 billion.

Hutchison said its consolidated mobile phone user base rose 71 percent from a year earlier to more than 23 million at the end of June, with particularly strong growth in India, where its customer base more than doubled to 17.5 million.

The company said it planned to invest HK$13.5 billion to HK$14.5 billion during 2006, mainly to build up its networks in India, Vietnam and Indonesia.

Hong Kong-based HTIL, which wants to position itself as a dominant mobile player in developing markets and has been an avid dealmaker, said it plans to launch service in Vietnam and Indonesia this year.

Shares in Hutchison Telecom closed on Wednesday up 2.6 percent at HK$13.40 ahead of the results release. The stock rose 11.6 percent in the first half of this year, outpacing a 9 percent gain in the benchmark Hang Seng index over the same period.

At the Reuters Global Technology, Media and Telecoms Summit in Hong Kong earlier this year, Canning Fok, Hutchison Whampoa's managing director, said Hutchison Telecom's business in India aimed to go public this year to help fund its expansion.

This month, a dispute between India's Essar group and a unit of the Hutchison Telecoms group over a Mumbai mobile phone company was put on hold for at least four weeks by an India court as it awaits arbitration.

The two sides have been battling over a deal to merge the Essar-owned Mumbai company, BPL Mobile Communications Ltd., with Hutchison Essar Ltd., which is majority-owned by Hutchison Telecom but in which the Essar group also holds a minority stake.

The Essar group, which also has interests in steel and shipping, terminated the agreement because it had not been able to achieve government approval before an agreed deadline.