DoCoMo confirms India exit plans

Dylan Bushell-Embling
telecomasia.net
Japan's NTT DoCoMo has confirmed plans to exit its investment in India's Tata Teleservices, and has announced a 26% decline in net profit for the financial year ending in March.
 
In a statement, DoCoMo revealed that its board has decided to exercise its option to sell back its entire 26.5% stake in Tata Teleservices to the Tata Group “as soon as the conditions for such exercise are met.”
 
DoCoMo has the option to sell the stake at 50% of the price it paid for the shares if Tata Teleservices failed to achieve certain performance targets by the end of the year ending in March, which seems almost a certainty.
 
If accounting shows that the targets were missed, DoCoMo plans to exercise the put option by the end of June. The sale price would be 72.5 billion rupees ($1.19 billion).
 
DoCoMo had been rumored to be considering an Indian exit before the announcement was made, but earlier rumors suggested that the company had decided to hold on to the stake to give Tata Teleservices more time to turn around.
 
DoCoMo has separately revealed that its net profit declined 26.3% in FY13 to 491 billion yen ($4.8 billion), with revenue falling 8.9% to 4.47 trillion yen.
 
Mobile revenue fell by 212.7 billion yuan as a result of a discount marketing program. Voice revenues also declined by 80.3 billion yuan, but packet revenues grew by 121.2 billion yuan .
 
Total net additions grew around 80% year-on-year, with the company attributing the introduction of iPhones to its handset line-up. The operator's smartphone userbase increased to 24.35 million, while its LTE subscriber base grew 90% year-on-year to just under 22 million.

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