Dilip Modi, Chairman and MD, Spice Communications said that they are aiming at an EBITDA margin of 30% in FY08. He added that they are aiming at rolling out 2,000 sites in FY08.

According to him, network coverage has pushed subscriber growth. They are targeting 1.5 lakh subscribers every month.

Q1 average revenue per user, or ARPU, is at Rs 333 versus Rs 345 (QoQ).

Excerpts from CNBC-TV18's exclusive interview with Dilip Modi:

Q: Your EBIDTA has grown by about 30% on a QoQ basis. What exactly were the operating margins during this quarter and is it sustainable through the rest of FY08?

A: For the June quarter, vis-à-vis the previous quarter, we have seen a total revenue growth of about 15.3% on a QoQ basis, while EBITDA has grown by 50%.

This has basically been driven by the growth in network coverage, which has led to growth in subscriber base by nearly 16% QoQ. This, in turn, led to the revenue growth which has translated to the EBITDA margin expansion.

On the operating EBITDA front, we have been on an operating model wherein we pay lease charges to the tower operators, which gets reflected over the EBITDA, unlike the rest of the industry where it is below EBITDA.

As a result of that, on an adjusted EBITDA margin basis, we are reporting about 36% on an adjusted before lease rentals for this quarter versus on a total EBITDA margin of about 28% for the June quarter.

Going forward, we are looking at ramping up our network aggressively. We are looking at rolling out over 2,000 sites in the next 12 months as against 1,300 sites that we rolled out over the last 12 months.

Therefore, we believe that the same would translate into revenue growth and margin expansion, and will improve our EBITDA bringing it close to 30% going forward.

Q: What was your overall ARPUs for the quarter gone by? We understand that, in Punjab, it was close to about Rs 350 and in Karnataka it was about Rs 400.

A: Basically, in terms of the overall ARPU levels, we have about Rs 333 ARPU for the June quarter as against Rs 345, in the March quarter.

Q: You have added close to about 3.2 million subscribers in the month gone by. How do you see the subscriber additions coming by on a month-on-month basis for the rest of FY08? Can you quantify as to how much they could grow on a percentage basis?

A: In the June quarter, we effectively grew subscribers and crossed two million subscribers in Punjab and crossed about 1 million customers in Karnataka.

Overall, on a net basis, we grew about 4,40,000 customers in the quarter-ended June, which approximately works out to be 1,50,000 net adds per month. Going forward, we are hoping that as we start building out the network, we would be able to continue to grow subscribers in the same proportion, between 1,50,000 a month on an ongoing basis over the year.

Q: What does your market share position stands at, at the end of this quarter gone by? How do you hope that would actually pan out by the end of the year?

A: In the state of Punjab, from the last quarter, we hold the second largest position among the wireless operators, at about 23% wireless market share. That is more or less held at about 23-24%.

We have seen that our share of net additions QoQ has been improving. So, in the March quarter, we had a share of 23% and in this quarter it is closer to 25%.

In the case of Karnataka, our share of net additions has again been consistently improving QoQ. As of the end of the June quarter, we stood at about 8% market share in the state of Karnataka. So, we have been closer to 14.5% market share of wireless market, in combined Punjab and Karnataka.