Date:18/11/2005 URL: http://www.thehindubusinessline.com/2005/11/18/stories/2005111802300800.htm

Back Spice to manufacture GSM handsets

Our Bureau

Mr Prakash Nanani, Chief Executive Officer, Spice Telecom (right) and Mr Navin Kaul, Chief Operating Officer, Spice Telecom - Karnataka, at the launch of new brand logo in Bangalore on Thursday. — G.R.N. Somashekar

Bangalore , Nov. 17

CELLULAR service provider Spice plans to manufacture GSM handsets at its Baddi plant in Himachal Pradesh.

Speaking to Business Line, Mr Prakash Nanani, Chief Executive Officer of Spice, said, "We hope to offer a handset for Rs 1,000 in the Indian market in the next 12 months." The Himachal plant of Spice IT Peripherals, a subsidiary company, currently makes passbook printers. This plant was expected to be broadened for handset production.

Mr Nanani, however, declined to reveal the investment requirement and other details. Spice currently sells 25,000 to 35,000 handsets a month under its own brand name. These mobiles are basic, no-frills models and imported from Taiwan.

Through this backward integration, the company hopes to cash in on the subscriber growth.

The gross subscriber base in India is 51 million, and is growing fast. According to the Cellular Operators Association of India, there was a record subscriber growth of more than 2 million subscribers during the month of October 2005, a 4.15 per cent growth from September.

"We want to consolidate in the North," said Mr Navin Kaul, Chief Operating Officer, Spice Telecom-Karnataka. The company has applied for six new licenses, for Himachal Pradesh, Haryana, J&K, Rajasthan, Uttar Pradesh East and West.

Spice Telecom will also invest Rs 100 crore in telecom infrastructure in Karnataka. "The investment of Rs 100 crore will be over the next 75 days and will result in an addition of 300 new transmission towers," said Mr Kaul, while unveiling the new brand logo of Spice Telecom. It plans to add 150 more cell sites by mid-2006.

Spice Mega Malls and Multiplexes, a subsidiary of Spice, which develops and manages commercial property, is setting up a four-dimension screen theatre in Noida.

The company has invested Rs 100 crore in the multiplex. A 4-D screen allows one to `feel' the movie, with realistic effects including revolving seats.

Mr Nanani said this was an experiment and based on the reaction of viewers, would decide to install such screens in other cities.