Uninor Telecom

8/2/2019 Uninor Telecom

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Presentation over UninorTelecommunications

(Its position and strategy after 2G

licence cancellation)


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Present Scenario

1. Uninor is an Indian mobile network operator headquartered inGurgaon, India. The company holds Unified Access Service(UAS)licences to offer mobile telephony services in each of Indias 22 telecomcircles, and has received spectrum to roll out services in 21 of these(excluding Delhi).

2. The company is a joint venture between Telenor Group, atelecommunications company headquartered in Oslo, Norway, andUnitech Group, an Indian real estate company. Telenor owns acontrolling majority stake in the company (67.25%), which has been

branded Uninor in the Indian market.

3. Uninor offers mobile voice and data services based on the GSMtechnology, currently on a 4.4 MHz spectrum. With a value for moneyproposition in the market, Uninor targets youth and other communitieswithin the Indian mass market.


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Telenor factfile

* Telenor entered India in 2009, formed JVwith Unitech Ltd* Holds 67.25 per cent stake in the JV

* Currently, it is operational in 13 circles* On February 2, SC cancelled 122 licencesin total* 22 licences of Telenor got cancelled

* Last week, it sent a notice to Unitech Ltdseeking indemnity and compensation* It has already invested about Rs 6,100 crorein the venture


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Telenor Profile1.Telenor Group is the incumbenttelecommunications company in Norway, with

headquarters located at Fornebu, close to Oslo.Today, Telenor Group is mostly an internationalwireless carrier with operations in Norway,Denmark, Sweden, Serbia, Ukraine, Hungary,

Montenegro, Thailand, Malaysia, Bangladesh,India and Pakistan.

2. Prima facia, Telenor entered India looking athigher customer base availability and revenuegeneration. Uninor under Telenor influence setsome unrealistic targets of revenue generationwhere they expected Profit generation from 5thYear.


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Why Telenor will not continue in India?

The


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Market Share of Tel Operators


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Telenor Strategy to Enter India

Launching its Indian operation, Telenor

announced a set of financial targets for the newventure. Uninor is targeting an 8% pan-Indiamarket share, breaking even on EBIDTA withinthree years of launch and obtain positive

operating cash flow within five years of launch.The operational operational peak fundingrequirement is set at INR 155 billion.Uninors strategy to reach its targets is based on

three strategic pillars;* servicing the basics,* excellence in mass market distribution and* cost efficient operations


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What Went Wrong

1. Supreme Court Cancelled all 22 licences ofUninor making it compulsory to bid for newlicences if want to continue with services.2. Telenor when entered India, Unitech hasalready received the licences however was inwait for right partner.3. Telenor Entered India with 67% stake inUnitech which was higher than expected stake.

4. Telenor valued Unitech at 400 Cr whereasBNP Paribas valued Unitech at 800 Cr andUnitech valued itself worth 12000 Cr.


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What to do strategy for Telenor

1.Exit silently without much hype and legal

proceedings. Transfer or sale stake atreasonable rate to interested Indian/foreignentity.2.If Exit is simply not possible, Try to build

repo with Unitech and fight effectively in legalproceedings and continue to work.3.Buy Unitechs remaining 33 % stake in JVand sell it to other Indian company for JV for

legal requirement and start own flagshipcompany under Telenor Brand.4.Once regained grounds, try to divercify thebusiness in Telecom sector.


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Why Telenor will not continue in India?

1. UAS (Unified Access Licence) for 22 circleswhich was costing somewhere around 1700CR till now will charge 11,000 CR once newallotment begins.

2. For offering 3G services there will be extrainvestment requirement which are yet to bedisclosed.3. Operational Peak Funding was set in JV byTelenor was worth 15500 CR out of which ithas already invested 6100 CR so far and newlicence fees will cross its investment limits.


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If Continues what will be the reasons?

1.In Just 2 years of Operations, Uninor hasalmost reached substantial market share of3.5 % which is growing. (Current users are 30miillion and growing)

2. Its vision to achieve market share of 8% tilthe 2018 is easily achievable.3. It is admired brand by the basic users andappreciated by market for cheap and quality

offerings4. India is a huge opportunity for Telenor tobe top in terms of no. of users worldwide andfuture prospects.


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THANK YOU !

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Uninor Telecom