Norwegian telecoms group Telenor set ambitious profit targets, banking on the continued resilience of its main Scandinavian and Asian markets in a faltering global economy, rising demand for data services and cost cutting. The state-controlled group, with over 150 million subscribers after an aggressive push into Asia, also said in presentations to investors that it would keep debt down, had no major acquisition plans and would keep a grip on spending in India, even as it takes part in a costly licensing round. While telecoms groups are generally benefiting from a surge in demand for data services as consumers increasingly use smartphones to access the internet, many have been hit by a deep economic recession in parts of Europe. Telenor has benefited from the comparative strength of Scandinavian economies, where it is the biggest player, and from its expansion into fast-growing Asian markets, like India. The group said it aimed to lift its operating cashflow to between 28 billion and 30 billion crowns ($4.90-$5.25 billion) by 2015, a big increase from 19.1 billion crowns in 2011 and ahead of market forecasts in the 26-27 billion range. It also plans to save 5 billion crowns on operating expenses and said it would pay out between 50 and 80 per cent of its profit in dividends with nominal dividend growth for each year. Although analysts called the new targets ambitious, investors judged them credible, pushing the stock up 0.8 per cent in early trade after it has outperformed peers all year. Telenor shares have gained over 13 per cent this year, well ahead of the 1 per cent fall in the broader European telecom index. “They’ve set ambitious goals for 2015,” said Espen Torgersen, an analyst at brokerage Carnegie. “The targets are clearly above market expectations and put the focus on better operations and higher cash flow. This is surprisingly positive.” Barclays added: “Telenor is the only incumbent stock in our coverage that offers positive real growth in 2012/3.” It added that Telenor shares trade well above peers in terms of valuation but “with much superior growth potential -revenues, free cash flow and dividends.” Telenor has a unique global profile with its European and Asian focus, and competes primarily with local players. Its bigger competitors include TeliaSonera in Scandinavia, Deutsche Telekom in central Europe, Vodafone in India and Singapore Telecom in south east Asia. It said growth in Asia has been exceptional over the past few years and it expects the region to remain strong in the years ahead. India, the world’s second biggest mobile phone market by subscriber numbers, has been a key growth area but Telenor is now at risk of losing its operating license after courts cancelled 122 regional operating permits held by eight carriers granted in a scandal-tainted licensing round. Telenor faces a costly new licensing round, which risks pushing it above its self-imposed investment cap, but the firm repeated it would not breach that ceiling. “We are in the midst of a new licences process which has got initial terms; but we have not yet seen the complete package,” Chief Executive Jon Fredrik Baksaas said. “By Oct.18 we will have a clear view point of how we will participate in the licence process.” The Uninor unit, a joint venture with Indian property company Unitech, had accumulated losses of 127 billion Indian rupees by the end of the second quarter and Telenor said its peak funding cap would remain 155 billion rupees. It estimated that the upfront license price for the nine regions it was most keen on, would be at least 24 billion rupees in the auction set to start Nov.12 and end by Jan.11. Telenor restructured the unit this year in preparation for higher license fees and focused on more profitable regions to bring forward its break even time to the end of 2013 from the first half of 2015. Telenor said last month that it was increasing its stake in Russian mobile-phone company VimpelCom to almost 43 per cent and expected the deal to close before October. Baksaas said he would like to take advantage of Telenor and VimpelCom’s size, which could lead to better deals when buying telecommunications equipment in Russia.