Sistema Shyam Q2 loss narrows down at Rs 844.7 crore

Compnay also has one-time loss reduction of around Rs 469 crore due to closure of operations

Sistema Shyam Teleservices (SSTL), on Monday, reported a smaller quarterly loss at Rs 844.7 crore during the second quarter ended June 30, 2013, as it had scaled down its operations following a Supreme Court order.

The company had posted loss of Rs 1,180 crore during same period a year ago.

SSTL, which is majority owned by Russian conglomerate Sistema, has reported a 30% fall in revenues at Rs 290.9 crore during the April-June quarter. The company, at present, operates in nine telecom zones of the country’s 22 circles.

During the quarter, it also had one-time loss reduction of around Rs 469 crore due to closure of operations.

The net income declined mainly on account of forex losses and exit costs, the company said, in a statement. During the quarter, SSTL invested Rs 15.4 crore and its total debt stood at Rs 4,187 crore.

“In the quarter, SSTL continued its efforts to optimise costs and exercise strict control over expenditures. Going forward, the challenge is to bring the Company back on its high growth path by efficiently investing in the business,” said Sergey Savchenko, chief financial officer, SSTL.

During the quarter, SSTL halved its OIBDA (operating income before depreciation and amortisation) loss to Rs 219.3 crore from Rs 450.9 crore.

In April this year, SSTL had said that it targets to breakeven in India by the second quarter of 2015. It has already reached the break-even point in West Bengal telecom circles in the fourth quarter of 2012.

SSTL, which has bought fresh spectrum under the 800 MHz band through auction in March in eight circles and has announced its plans to provide 4G LTE services, estimated that the company would require investing about $200 million (about Rs 1,093 crore) to roll out 4G LTE. The company is planning to start network-testing within the next two months.

In March, SSTL won 3.75 MHz of spectrum in each of eight circles — Delhi, Kolkata, Gujarat, Karnataka, Tamil Nadu, Kerala, Uttar Pradesh (West) and West Bengal for Rs. 3,639 crore. The company already has operations in Rajasthan circle.

The company had entered India in 2008 and has reportedly invested around $3.6 billion in the India.