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Vodafone India profit rises three-fold, IPO unlikely this yr

Corporate

Vodafone disagrees with 900 mhz pricing formula

By Sindhu Bhattacharya

Vodafone India is willing to pay for 900 mhz spectrum based on auction discovered price for 1800 mhz but disagrees with the pricing formula. At present, price for 900 mhz is two times that of 1800 mhz.

CEO and MD Marten Pieters said today the formula should be 1.3 times and not two times the price of 1800 mhz spectrum price.

He also made it clear that though Vodafone does not agree with the process where 900 mhz spectrum would be taken away from incumbents for auctioning afresh, his company is willing to pay for this spectrum at market prices.

AFP

AFP

In some metros like Delhi and Mumbai, there is no 900 mhz spectrum free for auctions and therefore the Government has said it will "refarm" by taking it away from incumbents and auctioning it at a higher price. But, Vodafone is objecting to it.

Pieters also said the uncertainty surrounding extension of those Vodafone licenses which come up for renewal in the next two years will keep the company from coming out with an initial public offer (IPO).

"An IPO is impossible unless there is certainty around spectrum pricing and license renewal. It is very difficult to launch an IPO this year," he said. Pieters said that auctions are the right way of determining spectrum prices but reserve price should be lower.

Vodafone India today said its adjusted operating profits rose by more than three-fold to GBP 221 million (about Rs 1,853 crore) for the year ended March 31, 2013. The company, part of the UK-based Vodafone Group, had posted an adjusted operating profit of GBP 60 million (about Rs 503 crore) in the year-ago period, it said in a release.

The company's revenues also rose by 1.17 percent to GBP 4.32 billion (about Rs 361.9 billion) from GBP 4.27 billion (about Rs 357.7 billion) during the same period.

Its free cash flow for year ended March 31, 2013 rose to GBP 729 million from GBP 531 million in the year-ago period.

by Sindhu Bhattacharya

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