Bangladesh Submarine Cables posts 28% profit slump in H1
The state-owned firm stated that the decline was due to the reduction in revenue from its main business
Amid rising competition from private territorial cable operators, state-owned Bangladesh Submarine Cables Company, a listed entity on the stock market, reported declines in both revenue and profit during the first half of the current fiscal year 2024-25.
In continuation of a setback in FY24, the downward trend in business and profitability persisted in the first half, driven by a decline in income from its main services, International Private Lease Circuit and IP transit services, according to its unaudited financials for December 2024.
During the July-December period of FY25, Bangladesh Submarine Cables' revenue fell by 19% to Tk195 crore, while its net profit dropped by 28% to Tk92.21 crore compared to the same period in the previous fiscal year.
However, concerning the significant decrease in profit, the state-owned firm stated that the decline was due to the reduction in revenue from its main business, and an increase in operation and maintenance expenses.
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As an immediate effect of lower profit and revenue, yesterday, Bangladesh Submarine Cable's shares price dropped by 4.11% to Tk121.40 each on the Dhaka Stock Exchange (DSE).
The growing competition with private sector
Bangladesh sources internet bandwidth from two main channels — terrestrial and submarine cables.
Bangladesh Submarine Cable Company provides internet bandwidth through submarine cables, while international terrestrial cable (ITC) operators in the private sector supply bandwidth through terrestrial cables.
The ITC licence holders supply internet bandwidth from neighbouring India through international terrestrial cables connecting India's landing stations to Bangladesh.
In 2012, the Bangladesh Telecommunication Regulatory Commission (BTRC) issued licences to six private operators, four of which are now in active commercial operation, according to Bangladesh Submarine Cable's latest annual report for FY24.
According to company sources, the international terrestrial cable operators are the primary competitors of Bangladesh Submarine Cable, sometimes offering lower tariffs to attract customers due to their lower costs compared to the state-owned firm.
As a result, the state-owned company has been losing market share over the years.
To remain competitive, Bangladesh Submarine Cable sometimes needs to lower its service tariffs, which impacts its revenue, the company mentioned in its annual report.
Despite the tough competition from the international terrestrial cable operators, the Bangladesh Submarine Cable holds about 45% of the country's international bandwidth market share, the report states.
However, the BTRC has recently taken a significant step to limit internet bandwidth imports from India, a move expected to promote local capacity utilisation and healthy competition.
Approximately 60% of the country's national demand is met through ITC imported from India via the Benapole border — a trade that the Sheikh Hasina government had encouraged for over a decade.
This growing dependency has sidelined the state-run Bangladesh Submarine Cable, whose infrastructure investments exceeding Tk1,000 crore remain significantly underutilised.
To address this disparity, the BTRC has proposed limiting the share of bandwidth sourced through international terrestrial cables from India to a maximum of 50% of the total demand.
