Spice Communications, the Modi Group held company, grew 31.2 percent to reach
a turnover of Rs 486.7 crore, as compared to an extraordinary growth of 146
percent last year. The subscriber base grew by 75.1 percent to reach 4.7 lakh.
In revenue terms, 59.1 percent came from Punjab while the rest 40.9 percent came
from Karnataka. In terms of subscriber break-up, only 35 percent of the
subscribers were from Karnataka, while 65 percent were from Punjab. Spice
Communications’ ARPU is one of the highest in the country.
The parent company, SpiceCorp sold the sister company SpiceCell to Bharti.
While there were speculations that Spice Communications would also get sold, it
has not happened so far. The presence in two of the highest potential markets,
that are geographically so apart, and no commonality makes the company manage
the two operations almost as two companies. While in Punjab, it has one of the
highest spread of network and the revenue is quite distributed, in Karnataka,
revenue is generated from the state capital and the infotech city–Bangalore.
With increased competition from bigger companies, it will be a challenging
task before the company to compete. Most industry observers expect some M&A
activity as far as Spice is concerned.