Financial Insight of Pakistan Cellular Industry – 2010

Pakistan’s Cellular industry faced tough fiscal year 2009-2010. Hiked pricing, lower buying power, power crisis, currency devaluation and price war remained major strikers for the cellular companies in year 2009-2010.

Objective of this report is to analyze the industry’s growth & performance of individual players. Companies may benchmark their next year’s strategy on the basis of Network KPIs given in Section 4 of this report.

1. Revenues

In comparison to 17% revenue growth in FYE 2009, overall industry revenue growth slowed down to 11% in FYE 2010.

Revenues

Following graph shows the contribution of individual cellular players in the revenue growth. During FYE 2010, 39% of increased industry revenue was picked by Ufone, followed by 32% by Telenor & 15% by Zong.

Warid & Mobilink’s share in the increased industry revenue remained less than average industry growth rate of 11%.

Revenue_Growth_Rate

2 – Market Share (in terms of revenues)

In terms of revenue, Ufone, Telenor & Zong managed to increase their market share, while
Warid & Mobilink continued to lose.

Revenues_Market_Share

3. Network Roll-Out

2,000+ sites were rolled‐out during the fiscal year 2009-2010. Ufone & Zong continued to aggressively roll‐out network (Ufone added 820 sites, Zong added 760 sites) during FYE 2010. Warid’s network roll‐out remained on‐hold (added 78 sites during the year).

network_roll_out

4. Network Utilization KPIs

Industry Revenue/avg. cell site dropped from PKR 8.6m in FYE 2009 to PKR 8.1m in FYE 2010. Following table shows that Mobilink topped network utilization in terms of revenue generation with PKR 10.7m per site, followed by Ufone & Telenor at PKR 9.3m per site.

Revenues_per_cell_site

In comparison to network size, revenue market share of Mobilink, Ufone & Telenor is higher than network share, while Warid & Zong remained on lower side in terms of revenue share.

network_share

5. Conclusion:

Industry’s growth is slowing down over the period of time, which means that new subscribers’ addition is reducing and future competition will be focused more towards launch of innovative products/services to increase revenue streams.

Subscribers’ retention & acquisition of subscribers is already on the top of to-do lists, along-with, customer support is going to play pivotal role in coming days.

Data Source: PTA’s annual report for year 2009-2010