Videsh Sanchar Nigam Limited (VSNL) has posted a 2% decline in net sales for the quarter ended 31st December 1999. The company has however posted an 11% rise in profits.
VSNL (FY99 Income Rs 71.76 bn) is India's monopoly provider of international telephony services. It also provides telex and telegraph services as well as value-added services such as leased lines, e-mail, Internet and video conferencing.
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The company has posted a decline in net sales and other income during the quarter. However, the sharp decline in operating expenditure has helped the company pull through a rise in profits. The decline in sales has been attributed to the lower tariff rate implemented by the Trai. Value-added services provided by the company continued to register a sharp rise during the quarter.
The company Internet related revenues grew by 211% during the quarter. VSNL continues to be the leader in the domestic markets with over 322,000 subscribers.
VSNL has failed to make provisions for its investment (US$ 150 m) in the now bankrupt ICO Global, a satellite telephony company. As and when these provisions are made, the company's bottomline could take a beating.
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