The country's cellular industry has posted a robust growth of 119 percent in terms of subscription during the last seven years from 2000 to 2007, said Mohammed Ali, an economist at the Investment Capital and Securities (Pvt) Ltd on Friday.
He, however, held the absence of direct listing of the prominent cellular operators' in the stock market as major factor that restricted the opportunities for investors to extract financial benefits from their growth. He pointed out that the cellular industry presently grabbing over 74 million subscriptions has witnessed an average addition of more than 2 million subscription ever month during the last two years.
Mobilink is leading the cellular market followed by Ufone- a 100 percent owned cellular subsidiary of the Pakistan Telecommunication Company Limited (PTCL).
The emerging interest in the country's fast growing cellular industry is obvious from the acquisition of Paktel (89 percent shares) by China Mobile -CM Pak at an enterprise value (EV) of $460 million and Warid Telecom (30 percent shares) by Singapore Telecommunication Ltd (Singtel) for EV of $2.9 billion.
The CM Pak's aggressive future strategy on the country's market can be well gauged by its initial launch of $700 million cellular expansion plan, which will be followed by an estimated investment of $400 million a year in Pakistan, Muhammad Ali said.
He called the Mobilink, Ufone, and Telenor the chief market players in terms of cellular subscription. He added that the parent companies of these cellular operators had been listed in Egypt, Pakistan and Norway.
He pointed out that Mobilink had already injected more than $2.5 billion in the country's telecom sector, and still plans for further investment in the future. It's 6,5000 km optic fiber with the plan of further expansion for 2,000 km will help it improve quality of services.
Ufone posted a revenue growth of more than 40 percent in the fiscal year 2007 and was observed to contribute (in PTCL's group revenue) around 20 percent in the fiscal year 2007 as compared to 14 percent in the last fiscal year 2006. The infrastructure-sharing agreement for 10 years between Ufone and Telenor is also expected to generate beneficial results.
Telenor Pak has more than doubled its subscribers base to about 14 million over a year's period (November 2006-07). The growth was also accompanied by the operator's rising market share from around 14 percent to 19 percent over the same period.