See tariffs increasing; to reduce debt significantly: RComm

Below is the transcript of Gurdeep Singh’s interview with Reema Tendulkar on CNBC-TV18.Q: What is your outlook on the CDMA business? What is the outlook on the revenue per minute, it has gone up by 1.8 percent? Is there any target? Do you think you can continue to improve it 2 percent or so every quarter? A: As I said, in the wireless segment, 74 percent of our revenues come from GSM where we have seen a robust 4.2 percent growth quarter-on-quarter (QoQ), and the balance 26 percent comes from CDMA which for the first time after several quarters have shown stabilization. Largely because the handset ecosystem is now becoming ubiquitous and it is improving and we see the trend continuing. Also, we have launched many initiatives on the data front on the CDMA with our dongles and wi-fi routers which are helping us get disproportional share of data revenues. So, going forward we see CDMA now positively contributing to our growth of overall wireless revenues. Q: Do you have tariff pressure going forwards?A: We still believe that there is a headroom available for the tariffs to go up at least between 4-6 percent in the next 12 months, largely coming on the back of continued removal of pre-minute and promotional minutes, and some tariff rationalisation across product plans to align them to the cost-to-serve. We see the tariffs moving northwards in the future and RPMs will continue to harden, besides the fact that we are also supported by lower comparative intensity on ground.Q: The interest cost has come down on a QoQ basis, can you tell us what the net debt currently stands at and can be expect reduction in debt going ahead?A: As you recollect that in July last year, we had done India's largest successful QIP and we said that we will have a positive impact on the interest cost reduction in the range of Rs 400-500 crore. Currently our net debt to EBITDA stands at below 5. We plan to bring the net debt to EBITDA in the range of 3 within the next 2 years by the combination of internal accruals, sale of our non-core assets like global business, real estate, DTH and securitisation of tower sharing agreements with Reliance Jio. We are very well focused on these initiatives and are confident of executing the same in the given timeframe.Q: What about the securitisation of receivables of two billion from rel jio?A: We are currently in the process of completing the handover of towers for the tenancies to Reliance Jio, and we hope to conclude that exercise in the next couple of months. Post that, we will take up the securitisation of the proceeds against the Rel Jio agreement.