Mobile TelecomBuilding Connections
March 2016
Pakistan Cellular Industry
Industry – Structure
Regional Comparison
Snapshot
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
Mobile density in Pakistan
Year Total Mobile density (%) Unique Mobile density (%)
FY1048% 22%
FY1152% 24%
FY1259% 27%
FY1363% 29%
FY1472% 33%
FY1570% 32%
Total mobile density represents the percentage of population
having mobiles while unique mobile density captures the
number of actual subscribers, thus wide gap between the two
shows the potential available to the industry players
Pakistan Cellular Industry
Industry – StructureRegional
ComparisonSnapshot
Decline in the subscribers owing to biometric verification of SIMs
Mobilink - the market leader, despite decline in share.
Increasing share of Telenor and Zong.
Market share
Period Mobilink Telenor Zong Ufone Warid Total
Subscribers 33,378,161 26,667,079 10,927,693 20,533,787 17,387,798 108,894,518
Share 31% 24% 10% 19% 16% 100%
Subscribers 35,953,434 29,963,722 16,836,983 23,897,261 13,499,835 120,151,235
Share 30% 25% 14% 20% 11% 100%
Subscribers 37,121,871 32,183,920 21,177,156 24,547,986 12,706,353 127,737,286
Share 29% 25% 17% 19% 10% 100%
Subscribers 38,768,346 36,571,820 27,197,048 24,352,717 13,084,823 139,974,754
Share 28% 26% 19% 17% 9% 100%
Subscribers 33,424,268 31,491,263 22,102,968 17,809,315 9,830,620 114,658,434
Share 29% 27% 19% 16% 9% 100%
Subscribers 35,156,550 33,191,103 23,518,919 18,750,250 10,323,691 120,940,513
Share 29% 27% 19% 16% 9% 100%
Subscribers 36,211,426 34,928,330 24,133,283 19,931,821 10,694,778 125,899,638
Share 29% 28% 19% 16% 8% 100%
Cellular Sims (Number of Active SIMs)
2QFY16
1QFY16
FY11
FY12
FY13
FY14
FY15
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
3G/4G Subscribers
Operator Technology Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15
Share in
the total
subscriber
base
Mobilink 3G 3,656,345 730,000 1,795,549 2,860,079 3,656,345 4,909,203 7,248,761 5.8%
Telenor 3G 4,162,616 650,094 2,268,860 3,530,421 4,162,616 5,485,083 6,373,498 5.1%
Zong3G 2,898,094 947,363 1,661,286 2,921,021 2,898,094 3,769,542 4,752,974 3.8%
4G 105,128 26 2,242 31,582 105,128 201,564 282,701 0.2%
Ufone 3G 2,570,283 1,365,259 1,952,584 2,662,310 2,570,283 3,518,635 4,293,739 3.4%
Warid LTE - - - 66,140 106,211 156,827 214,046 0.2%
Total 9,736,121 2,962,742 5,884,972 9,211,474 9,842,332 13,131,651 15,916,958 12.6%
Dec-15 Mobilink Telenor Zong Ufone Warid Total
Shareof 3G subscribers in the
cellular operator's subscriber base 20.0% 18.2% 19.7% 21.5% N.A. N.M.
Shareof 4G subscribers in the
cellular operator's subscriber base N.A. N.A. 1.2% N.A. 2.0% N.M.
Share of 3G/4G subscribers as
%age of total 3G/4G subscribers 45.5% 40.0% 31.6% 27.0% 1.3% 100%
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
Growth due to
maturity of cell sites
Mobilink
owning the
largest cell site
network
followed by
Zong.
FY13 Share FY14 Share FY15 Share
Mobilink 9,057 25% 8,593 23% 9,902 24%
Zong 6,308 18% 7,514 20% 8,651 21%
Telenor 7,599 21% 8,179 22% 8,321 20%
Ufone 7,981 22% 8,291 22% 8,318 20%
Warid 4,944 14% 4,999 13% 5,512 14%
Total 35,889 100% 37,576 100% 40,704 100%
31,303
33,920 35,889
37,576
40,704
3.9%
8.4%
5.8%
4.7%
8.3%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
-
4,200
8,400
12,600
16,800
21,000
25,200
29,400
33,600
37,800
42,000
FY11 FY12 FY13 FY14 FY15
Gro
wth
Cel
l S
ites
Total Cell Sites
Pakistan | Average Revenue/Month
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
2.4 2.4 2.4 2.32.0 2.0
5.2 5.3 5.24.9
4.4 4.3
0.0
1.0
2.0
3.0
4.0
5.0
6.0
FY10 FY11 FY12 FY13 FY14 FY15
Average Revenue Trend
Per Mobile Per Unique Subscriber
US
D
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
During FY14, the total telecom
investment increased by three
times on YoY.
98% of this investment was
made in cellular segment on
account of planned acquisition of
3G and 4G spectrum and
deployment of advanced
telecommunication networks.
During FY15 Telecom attracted
FDI of USD 121mln – 23% of the
total FDI received by Pakistan in
that period.
Telecom Investment(USD mln)
Cellular LDI LL WLL Total
2010-11 359 109 18 8 493
2011-12 212 16 5 7 240
2012-13 422 2 16 12 451
2013-14 1,790 2 14 10 1,816
2014-15 828 12 4 7 851Note: Investment 2014-15 are estimated
FY11 FY12 FY13 FY14 FY15
Total FDI 1,574 821 1,576 2,641 529
Telecom FDI/(FD Outflow) 79 (361) (408) 903 121
Telecm FDI share in Total FDI 5% 0% 0% 34% 23%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
(1,000)
(500)
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
US
D i
n m
ln
Foreign Direct Investment (FDI)
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
Pakistan’s telecom revenue after witnessing a decline of ~3%, stood at PKR 449bln
in FY15. Cellular mobile segment continues to have the largest share (FY15: ~71%;
FY14: 72%).
LDI: Long Distance
International
WLL: Wireless Local
Loop
VAS: Value Added
Services
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
Next Generation Mobile Services (NGMS) Results
Applicant Winner in 2100 MHz Band Winner in 1800 MHz Band
Total license fee received
in FY14
(USD)
Zong 2x10 MHz (USD 307mln) 2x10 MHz (USD 210mln) 517 mln
Mobilink 2x10 MHz (USD 301mln) - 301 mln
Ufone 2x5MHz (USD 148mln) 2x10 MHz 74 mln
Telenor 2x5MHz (USD 148mln) - 74 mln
Total 2x30 MHz 2x20 MHz 966 mln
NGMS remaining payable
Ufone 74 mln + Markup @ LIBOR + 3% p.a.
Telenor 74 mln + Markup @ LIBOR + 3% p.a.
Total 148 mln + Markup @ LIBOR + 3% p.a.
According to GSMA, Unique subscriber is single individual that has subscribed
to a mobile service and that person can hold multiple mobile connections.
Unique teledensity considerably lower than total teledensity.
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
China India Indonesia Japan Pakistan Philippines Thailand Malaysia Australia
Total Connections 1,278 927 257 148 137 112 96 37 31
Unique
Subscribers672 468 106 116 59 51 38 16 22
Total
Teledensity91% 72% 101% 117% 73% 111% 143% 119% 129%
Unique
Teledensity48% 36% 41% 92% 31% 50% 56% 54% 91%
0%
15%
30%
45%
60%
75%
90%
105%
120%
135%
150%
-
140
280
420
560
700
840
980
1,120
1,260
1,400
Su
bsc
rib
er i
n m
ln
Subscriber (Sim) Base - September 2014
Unique Subscriber Base - March 2015
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
392 365
287 270
217 215
136
62
-
50
100
150
200
250
300
350
400
450
China India Australia Thailand Pakistan Malaysia Indonesia Philippines
Min
ute
s
Average Minutes of Usage per Subscriber per Month
7.0
6.0
2.0 2.0 2.0
1.0 1.0 1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
US
Cen
ts
Call Charges per Minute
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
41.5 41.2
14.7
9.1 6.6
3.3 3.0 2.9 2.0 1.9
0
5
10
15
20
25
30
35
40
45
Japan Australia Malaysia China Thailand Philippines India Indonesia Pakistan Bangladesh
US
D
Average Revenue Per User Per Month
68%
59%
48% 47%44%
40%37%
27%
21%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Japan Australia Indonesia Philippines China Malaysia Thailand Pakistan India
Data Revenue as % of ARPU
Snapshot
Pakistan Cellular Industry
Industry – Structure Regional Comparison Snapshot
As competitive landscape exists, average revenues per user
(ARPUs) have yet to stabilize.
Business potential in value added services is expected to
provide impetus to revenue growth to the market players,
though time-line is uncertain.
Intense competition among players is expected to keep
EBITDA margin under pressure.
After acquisition of 3G and 4G spectrum, wireless internet
taken by the cellular operators
Mobilink to acquire 100% shares of Warid post regulatory
approvals and resultantly Abu Dhabi Group will in turn get
15% shares in Mobilink
After completion of the process, Warid and Mobilink will
merge into one company and consolidation will take place
Bibliography
1. Pakistan Telecommunication Authority (PTA) : http://www.pta.gov.pk/index.php?Itemid=1
2. PTA Annual Reports :
http://www.pta.gov.pk/index.php?option=com_content&view=article&id=361&Itemid=590
3. Cellular Operators Association of India: http://www.coai.com/reports-and-papers/coai-annual-
report
Analysts
Rana Nadeem
Unit Head Ratings
Aisha Khalid
Manager Ratings
Abdul Sami
Senior Financial Analyst
Contact Number: +92 42 3586 9504
DISCLAIMER
PACRA has used due care in preparation of this document. Our information
has been obtained from sources we consider to be reliable but its accuracy
or completeness is not guaranteed. The information in this document may
be copied or otherwise reproduced, in whole or in part, provided the source
is duly acknowledged. The presentation should not be relied upon as
professional advice.