Telenor’s huge operating loss might ‘force’ it to exit India

Telenor, the Norwegian multinational telecommunications company, has reported a huge operating loss of around Rs 2,530 crore for its Indian telecom business, because of which it has threatened to exit India if it fails to procure spectrum at reasonable rates.

This has happened almost at the same time when Telenor’s Indian arm is looking forward to expanding its 4G footprint, claiming the lowest tariff for these services as part of its affordable pricing strategy.

While announcing financial results in Norway, Telenor global CEO Sigve Brekke said, "Long terms presence in India is dependent on our ability to secure additional spectrum. We are not able to compete with current spectrum portfolio we have in growing data market."

Brekke added that they are looking at solution to procure spectrum along with "a price that we can justify".

"We are Looking at upcoming auctions and also looking at potential trading options... Need to be pragmatic to consider other alternatives if that turns out not to be a possible to find value focused solutions. We are looking at all sustainable business model option," Brekke said.

"We are in India to make money, if we don't see return then we need to look at other alternatives," Telenor CFO Morten Karlsen Sorby said.

Telenor has already launched 4G services in Varanasi, and is planning to roll out high speed services in 6 to 8 cities across its six circles, namely Andhra Pradesh, Uttar Pradesh East and West, Bihar, Gujarat and Maharashtra, in the coming two months.

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