The combined capital expenditure on telecom infrastructure of top
mobile operators such as Bharti Airtel, Reliance Communications, Vodafone and
Idea Cellular stood at around Rs 4,840 crore in Q2 2011-12.
Their combined Capex is lower than the industry estimates.
Bharti Airtel invested Rs 2,062 crore in India and South
Asia, while the capex of Reliance Communications was Rs 350 crore in Q2
2011-12. Idea Cellular’s spent during H1 2011-12 was Rs 2,100 crore. Vodafone
India spent around Rs 2,650 crore in H1. (see the chart below)
(Both Idea and Vodafone did not share their Q2 numbers. We
took half of their capex for calculating Q2 capex).
Reliance Communications will be looking at spending about Rs
1,500 crore as capital expenditure in the current fiscal.
Considering the fact that these operators command more than
two-third of the market, the capital expenditure by Indian operators will be
below market forecasts.
These four mobile service providers command 64.74 percent of
the wireless market in India (see the chart 1 below).
Ovum had predicted that Indian telecom operators’ spend in
mobile infrastructure will be $9071 million (around Rs 47,396 crore).
Going by the quarterly spend of these four operators, their
annual spend is likely to be below Rs 20,000 crore. New operators such as S
Tel, Sistema Shyam Teleservices, Uninor Wireless, Etisalat and Videocon are
going slow on their capital investments due to spectrum issues and uncertainty
in the Indian wireless market.
According to Ovum, Indian telecom market will see Capex of
$11,763 million (both fixed line and wireless) in 2011, $13,838 million in
2012, $15,061 million in 2013, $14,767 million in 2014 and $14,975 million in
2015. (See chart below)
Chart 1: Capex by top
4 mobile operators in India in Q2 2011-12 (in Rs crore)
Vodafone India |
1,327 |
Bharti Airtel |
2,062 |
Idea Cellular |
1,100 |
Reliance |
350 |
Total |
4,839 |
Chart 2: Service Provider
Capex (Source: OVUM)
USD Millions |
2011 |
2012 |
2013 |
2014 |
2015 |
India Total |
11763.09 |
13838.06 |
15061.43 |
14767.56 |
14975.27 |
India Fixed |
2692.197 |
3258.291 |
3231.653 |
3266.421 |
3350.595 |
India Mobile |
9070.889 |
10579.77 |
11829.78 |
11501.14 |
11624.68 |
Chart 3: Market share
(in %) of mobile operators as of August 2011
Bharti Airtel |
19.85 |
Reliance |
16.87 |
Vodafone |
16.65 |
Idea |
11.37 |
By Baburajan K