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The Financial Express

'Monopoly' awarded to single entity distorting competition: Robi CEO

| Updated: August 05, 2021 09:42:47


File photo of Robi's Managing Director and CEO Mahtab Uddin Ahmed File photo of Robi's Managing Director and CEO Mahtab Uddin Ahmed

A significant monopoly awarded to a single mobile phone operator has allegedly created a distortion in the market, undermining the consumers' interest and affecting the digital vision of Bangladesh.

It was also claimed to have been affecting the regulatory landscape while making it difficult for the comparatively weaker players to achieve their economic efficiency.

"No single entity should be allowed to dictate the price and output decisions," Robi's Managing Director and CEO Mahtab Uddin Ahmed told a press briefing on Wednesday.

The virtual event was organised to release the second quarter (April-June), 2021 financial reports of the country's second largest mobile phone operator, Robi Axiata Limited.

During the period of this year, it registered a profit after tax (PAT) of Tk 470 million.

"We are very happy to see that our digital vision has already begun contributing significantly to our financial performance," Mr. Mahtab said, adding that efficient cost management has helped the company earn a profit.

"We're going through experiments with innovative digital technologies to future-proof the company," he said.

The CEO, however, expressed dissatisfaction over the distorted price mechanism and distribution system (by the largest market player), saying that it was undermining the consumers' interest and weakening the telecom industry to the detriment of the Digital Bangladesh Vision.

He also expressed concern over the regulatory landscape due to lack of effective implementation of the SMP (Significant Market Power) regulation.

"The overall distortions are pushing the market into the brink of failure," he said, replying to a question."… and such a fragile state of the competitive landscape is making it difficult to achieve the condition of economic efficiency."

Aiming to enhance competition in the industry, the telecom regulator in February 2019declared Grameenphone as the operator with SMP.

However, the regulations are yet to be implemented.

Mr Mahtab alleged that the presence of significant monopoly power is discouraging investment in innovative digital technologies that is crucial for the future of Bangladesh.

Robi's PAT reached Tk810 million in the first half of 2021 supported by steadily rising revenue and efficient cost management, according to the financial results.

However, the EPS (earnings per share) of Robi Axita declined marginally in April-June (Q2), 2021 compared to same period of the previous year. Robi has reported its consolidated EPS of Tk 0.09 for April-June 2021 against Tk 0.12 for April-June 2020.

The company's consolidated EPS, however, rose steadily in April-June (Q2), 2021 compared to January-March (Q1) of the same year. Earlier, Robi reported its consolidated EPS of Tk 0.07 for January-March 2021.

The company has reported its consolidated EPS of Tk 0.15 for January-June, 2021 as against Tk 0.16 for January-June 2020.

The consolidated NOCFPS was Tk 3.01 for January-June 2021 as against Tk 2.54 for January-March 2020.

"Consolidated NAV per share was Tk 12.45 as on June 30, 2021 and Tk 13.90 as on December 31, 2020."

Compared to Q1, 2021, Robi's 4G subscriber base grew by 7.5 per cent in Q2, 2021, but compared to the same quarter last year, its 4G subscriber base grew by 65 per cent.

"Robi's subscriber market share stood at 29.4 per cent at the end of Q2, 2021."

Despite the pandemic related lockdown, Robi's revenue reached Tk 20.31 billion following a rise of 2.5 per cent in Q2, 2021, compared to the last quarter.

Compared to the same quarter last year, Robi's revenue rose by 15.2 per cent.

Voice revenue grew by 1.4 per cent in Q2, 2021, compared to the last quarter, but compared to the same quarter last year, voice revenue grew by 13.7 per cent.

Data revenue on the other hand have been speeding up at a faster rate with 3.6 per cent growth in Q2, 2021, compared to the last quarter.

Compared to the same quarter last year, Robi's data revenue grew steeply by 21.9 per cent.

During April-June, 2021 the company paid Tk 11.38 billion to the government exchequer which was 56 per cent of its revenue for the quarter.

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