1. Spice Communications Limited
Investor Presentation
03 Mar 2008

2. Spice is poised to become a pan-India player

3. Spectrum available for allotment to 2 new players. Spice being one.
Critical Success Factors Licenses and Allocation of Spectrum
Company is an incumbent and strong player in the states of Punjab & Karnataka, with conspicuous market-share (~4 million subscribers)
Company had applied for 20 more licenses representing over 90% market opportunity in Aug ‘06 and is having 1st priority based on date of application in 12 circles and 2nd/ 3rd priority in balance circles
TDSAT (Telecom Tribunal) has already directed the Dept. of Telecommunications to keep priority of Spice Comm while allocating Spectrum on the same basis
Spectrum available for allotment to 2 new players. Spice being one.

4. Strong case for additional licenses

5. Entry Barriers License / Spectrum
Without considering allocation for existing players (which is a dire need for most) and the need to allocate a minimum of 4.4 MHZ per new player per circle, it is apparent that there is a strong entry barrier for a new player to get allocation of spectrum.
At best, the aforesaid would imply there could be one or maybe 2 players who could get a Pan-India license.
Spice is the only existing player that has the opportunity to roll out on a Pan-India play – has the opportunity to address 90% market opportunity

6. Recent developments reinforce our case
The Economic Times, New Delhi, Feb 28, 2008
Recent judgments preserve our priority in Spectrum queue
Further strengthen our case for additional Licenses

7. Financial & Operating Highlights

8. Financial Statements Analysis
Operating Parameters
Financial Statements Analysis 7

9. Financial Statements Analysis
Operating Parameters
Financial Statements Analysis 8

10. Spice Comm: P&L Account
Rupees ( Million )
Year Ended 31 December 2007
6 Months Ended 31 December 2006
Operating Income
9,578
3,892
Other Income
768
106
Profit on Sales of Passive Infrastructure
4,393 -
Total Income
14,739
3,998
Total Operating Expenditure
7,343
3,053
EBITDA
7,396
945
Finance Costs
1,659
631
Depreciation & Amortisation
1,814
696
Amortisation of share issue expenses 40
Profit before Tax
3,884
(382)
Tax 82 5
Profit after Tax
3,801
(387) 9

11. Spice Comm: Operating Expenses
Rupees ( Million )
Year Ended 31 December 2007
6 Months ended 31 December 2006
Amount
% of
Operating Income
Operating Costs
4,213
44.0%
1,653
42.5%
Administrative Costs
1,209
12.6%
624
16.0%
Sales & Marketing Costs
1,391
14.5%
566
Revenue Sharing License Fee
529
5.5%
210
5.4%
Total Operating Expenditure
7,343
76.7%
3,053
78.4% 10

12. Balance Sheet Snapshot – December 2007
Rupees ( Million )
Dec'07
Period ended
Dec'06
Equity Share Capital
6,899
5,519
Reserves & Surplus
4,943 -
Loan Funds
15,725
12,079
Total Liabilities
27,567
17,598
Gross Block
27,835
20,440
Depreciation
10,418
10,263
Net Block
17,417
10,177
Investments
972
Net Current Assets (excluding cash)
4,233
(1,176)
Cash & Bank Balances
1,087
1,273
Net Current Assets
5,320 97
Misc. Expenditure
596
281
P&L Account
3,263
7,043
Total Assets 11

13. Financial Statements Analysis
Operating Parameters
Financial Statements Analysis 12

14. Punjab: Expanding network and subscriber base
70% increase in Cell Sites in one year
453 new towns covered since Dec 06
839
365
172
166
139
169 71 94
116
Total Market Share
Network Minutes (Mn per month)
Network expansion through innovative deals:
Capex Deal with ZTE:
Vendor financing agreement with ZTE Corporation & Huawei Technologies Co. Ltd.
Special Purpose Vehicle on 2 years trial basis
Opex Deal (Quipo)
Own built by Capex debt
One way / two sharing with other operators
Tower providers with moratorium terms
NLD / ILD Network Tieup
Transmission through SIFY
PoP Terminal through WIPRO
Market Share:
Punjab:
Spice: 22%; Bharti: 32%; Hutch: 14%; BSNL: 13%; Reliance: 9%; Tata: 8%; HFCL: 2%
Karnataka:
Spice: 7%; Bharti: 37%; Reliance: 17%; Hutch: 15%; BSNL: 15%; Tata: 9%
Combined Market Share in these two circles: 13.8% (4th largest operator)
Network expansion strategy to maintain Spice position as top two operators 13

15. Karnataka: Expanding network and subscriber base
95% increase in Cell Sites since Dec 06
223 new towns covered since Dec 06
794
304
139
170
181 15 57 99 52
Expansion strategy leading market share gain
Network Minutes ( Mn per month )
Network expansion through innovative deals:
Capex Deal with ZTE:
Vendor financing agreement with ZTE Corporation & Huawei Technologies Co. Ltd.
Special Purpose Vehicle on 2 years trial basis
Opex Deal (Quipo)
Own built by Capex debt
One way / two sharing with other operators
Tower providers with moratorium terms
NLD / ILD Network Tieup
Transmission through SIFY
PoP Terminal through WIPRO
Market Share:
Punjab:
Spice: 22%; Bharti: 32%; Hutch: 14%; BSNL: 13%; Reliance: 9%; Tata: 8%; HFCL: 2%
Karnataka:
Spice: 7%; Bharti: 37%; Reliance: 17%; Hutch: 15%; BSNL: 15%; Tata: 9%
Combined Market Share in these two circles: 13.8% (4th largest operator)
Network investments & increasing coverage has led to growth in market share 14

16. Investments Beginning to Yield Results
Punjab - Revenue Run Rate*
Karnataka - Revenue Run Rate*
Punjab – ARPU
Karnataka – ARPU
MOU:
Punjab: Have covered 56% of previous years’ total MOUs in the 6 months ending Dec 06
* Revenues are given as the average monthly revenues for the quarter ended
Increasing Subscriber Base Leading to Strong Growth in Revenues

17. Financial Statements Analysis
Operating Parameters
Financial Statements Analysis 16

18. Analysis- Income Operating Income Other Income
Operating Income during the year 2007 grew by 23% in comparison to annualized operating income of previous six months
Average monthly operating income grew by Rs. 149 Mio and reached to Rs. 798 Mio in comparison to Rs. 649 Mio in previous six months. Major contributors are -
Operating Income Component
Grew by (Rs. Mio)
Call Charges
110
Activation / Administrative Charges 15
VAS Revenue 19
VAS revenue contribution grew to 8.3% in the year 2007 in comparison to 7.4% in previous six months
Other Income
Other income grew by Rs. 662 Mio during the year 2007resulting into 263% growth over annualized other income of previous six months. Major contributors are -
Rs. Mio
Forex Gain
277
Interest Income 99
Operating Lease write back
250
Profit on sale of towers is Rs. 4,393 Mio in comparison to Rs. NIL in the previous six months

19. Analysis- Expenditure
Operating Cost
Operating Cost in the year 2007as a percentage of operating revenue grew to 44% against 42.5% during previous six months
Number of cell sites increased by 1,633 during the year 2007 and reached to 3,663 in Dec 2007 in comparison to 2030 in Dec 2006.
This increase in cell sites resulted into increase in following major costs -
Increase as a % of Operating Income
Repair Network
0.5%
Power & Fuel
2.8%
Rent
0.9%
The above increase in cost has been partially offset by savings in the following cost –
Savings as a % of Operating Income
Roaming Cost
1.4%
VAS outsourcing cost
1.2%

20. Analysis- Expenditure
Administrative Cost
Admin cost as a percentage of operating income during the year 2007 decreased to 12.6% against 16% in the previous six month
Economy of scale has started getting reflected
Major expense head for savings are following -
Expenses
Savings as a % of Operating Income
Salary
0.4%
Legal & Professional
1.5%
Traveling Cost
0.3%
Rent
0.2%
Provision for doubtful debt

21. Analysis– Expenditure
Sales & Marketing
Sales & Marketing cost as a percentage of operating income in the year 2007 remains at 14.5% as in the previous six months
Advertising & Marketing cost as a percentage of operating income in the year 2007 gave savings of 0.7% over previous six months
The above savings has been offset by increase in dealer commission by 0.7% due to higher gross additions of 2,732 K in the year 2007 in comparison to 992 K in the previous six months.
Revenue sharing license fees during the year 2007 is 5.5% of operating income in comparison to 5.4% in the previous six months

22. Analysis– Expenditure
Finance Cost
Finance cost during the year 2007 increased to 17.3% of operating income in comparison to 16.2% in the previous six month
Major items for increase are -
Particulars
Percentage
Interest on USD Debt
0.5%
Prepayment Charges on INR Debt
1.2%
Provision for Interest on WPC
0.7%
Interest on Finance Lease
2.5%
Others
Interest on finance lease and others are awaited
Above increase has been partially offset by savings of 4.1% in interest on INR Debt due to repayment of debt by Rs. 3,420 Mio during the year

23. Analysis– Balance Sheet
Shareholding Fund
Company raised Rs. 6,322 Mio through IPO during the year
Loan Funds
Balance of USD 10 Mio (Rs. 441 Mio) out of USD facility drawn down during the year
Rs. 3,420 Mio has been paid towards INR Debt repayment
Finance Lease obligation of Rs. 4,596 Mio has been created on account of capitalization of financial lease of towers
Rs. 323 Mio has been paid towards Vendor debt repayment
Deferred capital liability of Rs. 2,582 had been created on account of network assets procured on trial basis
Fixed Assets worth Rs. 9,054 Mio has been added during the year. Major assets added are -
Rs. Mio
Network Equipment
518
Assets taken on trial
3,026
Network Equipment on finance lease
4,375
Software
430
Handsets
394

24. Analysis– Balance Sheet
Loans and Advances increased by Rs 983 Mio mainly on account of -
Rs. Mio
Increase in deposit to BOL operators
145
Deposit with Spice Corp
100
ICD
250
WPC payment under protest
455
Other current assets of Rs. 5,122 Mio is on account of amount recoverable from tower sale
Current liabilities increased by 668 Mio mainly on account of -
Rs. Mio
Advance from customers
412
Sundry Creditors
223
Provisions have been increased by Rs. 154 Mio mainly on account of -
Rs. Mio
Provision for WPC Interest 67
Provision for MAT 66
Miscellaneous expenditure increased by Rs. 315 Mio mainly on account of shares issue expenses

25. Thank You