Increased input costs would necessitate price hikes and other leading operators are equally inclined to drive profitable growth irrespective of challenges from regional players. Impact of 2013 tariff changes has baked into the operations and next round of hikes could take effect in a couple of quarters.
Spectrum auction results were largely in line with expectations. The strategy was to i) advance the buyout of 1800 MHz in licences due for renewal in 2015/16 as a safeguard against any irrationality in 900 MHz later, and ii) expand the 900 MHz footprint given a decided investment pool (exited race for 900 MHz in Mumbai).
Debt for spectrum payout has been tied up and existing bondholders have approved the commensurate increase in leverage ratios to net debt/ ebitda of ~3.5x post the next round of auctions. This lowers the need for equity issuance. The management expects 10-12% CAGR in voice business in next few years.