Sistema Shyam TeleServices (SSTL), which operates under the MTS brand, today said its net loss widened by 63% to Rs 666.4 crore for the first quarter ended March 31, 2011, even though its revenues grew three-fold.
The company had posted a net loss of Rs 408.1 crore in Q1FY10, the company said.
"The decrease in margin is on account of increase in operational costs due to further scale up operations across all circles. Additionally, the circles of UP East, West and Gujarat, were launched in the latter part of 2010, hence the impact of their launch was felt in Q1 2011," SSTL, which has equity participation by Russia-based Sistema, the Russian government and the Shyam Group of India, said in a statement.
Revenues of the company grew three-fold to Rs 236.2 crore during the January-March quarter of FY11, as against Rs 78.6 crore in the same period last year.
The revenue growth was driven by a 168% increase in subscriber base over Q1FY10, the statement added.
"For the first time, our revenue growth during the quarter was faster than our growth in wireless subscribers. This is a strong reflection of our continued efforts to target quality customers," Sistema Shyam Teleservices Ltd President and Chief Executive Officer Vsevolod Rozanov said.
During the quarter, revenue growth was faster than the growth in total wireless (Voice and Data) subscriber base. Blended mobile Average Revenue Per User (ARPU) for the quarter remained consistent at Rs 82, as against a declining trend in the market, the statement added.
By the end of Q1 2011, SSTL expanded its mobile data services to 130 cities in India, including all five metros.
"Blended mobile ARPU also remained consistent as against a declining trend in the market. The quarter also saw the unveiling of our new brand identity with the tagline, 'A Step Ahead," Rozanov added.
SSTL's mobile subscriber base increased by 19% quarter-on-quarter and reached 10.05 million customers as of March 31, 2011.
Looking beyond Q1, 2011, SSTL in May, 2011, awarded the world's first CDMA expansion contracts and EV-DO -- a network used by cell phones for wireless Internet communications to China-based ZTE. The company plans to commence roll out of EV-DO Rev.B in Rajasthan by Q3 2011.
The capital expenditure made by SSTL in India to date stand at Rs 5,800 crore. This includes the investment of Rs 297 crore made during Q1, 2011. Consolidated debt from banks and financial institutions now stands at Rs 5,584 crore.
During the quarter, SSTL completed all formalities relating to the allotment of shares to the Russian government. The company issued 54,73,12,918 equity shares against the funds equivalent of Rs 2,698.8 crore ($600 million) received in December, 2010.