Bangladesh Submarine Cable Co profit grows 34 times in four years

Bangladesh Submarine Cable Company Limited, a submarine cable-based internet bandwidth provider, has posted a whopping 34-time growth in its profits in the span of four years from only Tk7 crore in FY18.

In FY22, the company saw its profit cross the Tk250 crore-mark - the highest in its history. 

Company sources put such a massive jump in the company's profit growth down to the government's efforts to strengthen digital connectivity across the country and increase 4G-based Internet usage.

The submarine cable company's revenue also surged by 214% to around Tk442 crore in these five years. Besides, its share price rose 114% in the Dhaka Stock Exchange. Each share of the company was traded at Tk219 on Monday.

The board of the company has decided to give a 46% cash dividend to its shareholders for FY22, which is also the highest so far.

At the end of the last fiscal year, the company's earnings per share (EPS) was Tk15.16 and the net asset value per share was Tk64.66. 

The company holds 75% market share

Currently, Bangladesh Submarine Cable Company operates two submarine cable landing stations with a capacity of 1,900 gigabits per second. The first is SMW-4 (South East Asia–Middle East-Western Europe) in Cox's Bazar launched in 2005 and the second is SMW-5 in Kuakata, which started operations in 2017.

Since the beginning of 2017, the company's market share began to increase significantly, which is now about 75%.

At present, Bangladesh consumes 1,564Gbps of bandwidth from the company and 95% of it comes from the Singapore route.

Besides, the submarine cable will double its bandwidth capacity by installing the third submarine cable SMW-6 in a bid to gear itself up for the growing demand.

For that, the company needs to invest Tk692 crore, of which Tk392 crore was set to come from the government while it will pay the remaining Tk300 crore on its own for the project scheduled for completion by 2025.

After the completion of the project, the bandwidth capacity will go up to 13,200Gbps from the existing 6,600Gbps. 

According to the Bangladesh Telecommunication Regulatory Commission, the number of Internet users was 12.72 crore till August this year, while mobile Internet subscribers were 11.61 crore and broadband users 1.11 crore.

Business costs to go up

To operate submarine cable-based Internet business, the Bangladesh Telecommunication Regulatory Commission formulated the guidelines on issuing licence in 2011. 

BTRC officials said the commission, however, did not provide any licence to build, operate, and maintain submarine cable systems and services in the country till date due to some problems.

Officials at the BTRC said at present, the Bangladesh Submarine Cable Company operates two submarine cables on special permission from the Ministry of Post and Telecommunication. The commission asked the government-owned company to submit an application for a licence under the new guideline because they are issuing the licence to the private sectors.

To obtain the licence, the company has to pay 3% of its total gross revenue to the BTRC.

According to the submarine cable company, at present, it has to share 10% of its revenue with the BTRC. After getting the licence, the share amount will be 13%.

Under the new guidelines, the BTRC has given licences to three private companies to operate submarine cables.

The companies are Summit Communications, CdNet Communications and Metacore Subcom Ltd. They are going to invest Tk2,000 crore in this sector, according to BTRC sources.