Telecom Lead Asia: Ericsson India has posted 13 percent increase in Q1 2013 revenue to $242.83 million (SEK 1,606 million).
Ericsson, announcing the financial result for Q1 2013, said that telecom operators’ spending in India remains cautious, principally because of sustained regulatory uncertainty. The momentum for managed services continued with a major contract signed in the quarter.
Ericsson India’s revenue from networks rose 30 percent to SEK 858 million in the first quarter.
Global services revenue in India was SEK 627 million, up 1 percent.
Support services generated revenues of SEK 121 million from Indian operations, down 12 percent in the first quarter of 2013.
Globally, Ericsson’s revenue rose 2 percent to SEK 52.03 billion.
Recently, Fitch Ratings said that Indian mobile operators’ intention to spend (Capex) around $5 billion to $6 billion – which is significantly low as compared with global operators in Asia — in 2013 will impact 3G and 4G growth in India in the next 2 years.
On Tuesday, Chinese telecom equipment maker Huawei said it expects a moderate growth in revenues from Indian market.
“In India, our revenue was almost flat, around $ 1 billion, due to uncertain regulatory environment. It was not only Huawei that was impacted but overall sector had seen the impact,” Huawei’s Head of International Media Affairs Scott Sykes said at company’s global analyst summit.
Indian telecom firms will invest a significantly lower proportion of their revenues (around 17-19 percent of revenue) over the next two years than their Chinese, Indonesian and Philippine peers, according to Fitch Ratings. This is due to the weaker balance sheets of the Indian operators.
Capex per subscriber for Indian telecom operators is much lower at $6 per subscriber than Chinese operators whose investment is an average of over $50 per subscriber. Operators in Indonesia and the Philippines have an investment of $16 per subscriber.
