Banglalink eyes IPO in two years
However, the company was on its way to seeing net profits, and that should not be far, according to Aas
Banglalink Digital Communications Ltd, the third-largest telecom operator in the country, is planning to go public in two years, said its CEO Erik Aas.
Despite six consecutive quarters of double-digit revenue growth, Banglalink was yet to be profitable enough to fit for an initial public offering (IPO), he said at the third quarterly performance disclosure event at Banglalink Head Office in the capital on Tuesday.
However, the company was on its way to seeing net profits, and that should not be far, according to Aas.
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Banglalink, a subsidiary of Amsterdam-based Veon, posted 15.1% year-on-year growth in its revenue to Tk1,588 crore in the July-September quarter, while over the first nine months of the year, its revenue grew by 16.6% to Tk4,591 crore.
The market-beating revenue growth was attributed to the highest customer growth in the industry, which let the company earn more data and service revenue.
According to the Bangladesh Telecommunication Regulatory Commission (BTRC), in a year till 30 September Banglalink saw the highest 4.51% growth in the number of customers active for 90 days, which was 0.27% for market leader Grameenphone, 3.26% for Robi Axiata, and slightly negative for state-owned Teletalk.
With 4.29 crore customers at the end of September, Banglalink's subscriber market share increased to 22.66%, lagging behind GP and Robi.
In the third quarter, the company secured an EBITDA (earnings before interest, tax, depreciation, and amortisation) growth higher than that in revenue, and this increases hope for the after-tax profits in the coming days.
Meanwhile, Banglalink, as the first telecom operator, has been selling its network towers to dedicated tower operators to turn into an asset-light firm with more cash in hand and a better focus on its specialisation areas, which include other digital services like entertainment app Toffee.
Toffee has attracted 1.21 crore users, 70% up in a year, and seven in every ten of the app's subscribers are non-Banglalink users.
Erik Aas said Banglalink was enjoying the benefits of its cumulative investments in quality mobile internet as the growth in 4G users and the revenue from them were sharply up in recent quarters.
Banglalink's capital expenditure, however, was 33% down year on year to Tk929 crore in the first nine months of this year, reflecting another drive towards profitability.
Toffee user Banglalink subscribers on average pay the company Tk285 in revenue a month, while the regular average revenue per user per month is Tk132 for the company.
Banglalink officials, however, did not disclose the net loss figures yet.
Except for Grameenphone, telecom operators in Bangladesh have been struggling to maintain a fair bottom line due to high costs of licences and capital expenditures for continuous investments in capacity improvement, while firms have long been urging the government to rationalise taxes, including the turnover tax, which further squeezes the loss-making firms.
