Military-run Viettel Global Plans to Penetrate Two Populous Countries

Vietnamese telco Viettel Global plans to make inroads into Indonesia and Nigeria, among the world’s ten most populous countries.

Viettel Global, the international arm of military-run telecommunications firm Viettel, has announced plans to invest in Indonesia and Nigeria, the fourth and seventh largest countries in the world in terms of population.

The investment in Indonesia, which accounts for 70% of the population in Southeast Asia, will help Viettel expand its tentacles to other neighboring markets, the firm said in a document submitted for shareholders’ approval at a recent annual general meeting.

Further, subscribers of third and fourth generation of wireless mobile telecommunication technology (3G and 4G) make up just 58% of the population, below the proportion in other regional peers.

Nigeria is reckoned a potential market with GDP per capital higher than Vietnam’s and affluent population. Meanwhile, the African country’s telecommunications infrastructure is underdeveloped, with modest penetration of 3G, according to the document.

Big Investments

Viettel Global is now present in ten overseas markets including Laos, Cambodia, Timor Lester, Cameroon, Haiti, Mozambique, Burundi, Peru, Tanzania and Myanmar, with a combined population of 230 million people.

With the two new countries’ large geographical areas, investments there will require big sums. Viettel has earmarked $1 billion and $1.5 billion for its investments in Tanzania and Myanmar with respective populations of 50 million and 60 million.

In addition to its own capital, Viettel will take out loans or acquire equipment on credit to carry out its plans, VnEconomy cited company executives as saying.

Headwinds in Overseas Markets

Viettel Global posted revenue of $1.04 billion last year, representing a decline of 21% from a year earlier, VnEconomy cited a financial report as saying.

The company attributes the plunge in its revenue to strong devaluations of local currencies against the U.S. dollar, natural disasters, and competition from existing players as well as OTT services. In addition, the firm is facing shortages of personnel and skilled workers.

Continued currency devaluations coupled with political uncertainty and economic risks pose challenges to its overseas operations, the company said.

This year, it aims to record revenue of $1.34 billion, up 29% year-on-year, and a pre-tax profit of $5 million.

Tuan Minh / BizLIVE