Idea net up 14% to Rs 228 cr; rules out major tariff hike
Mumbai: Country's fourth largest telecom operator Idea Cellular, which Tuesday reported 14 percent rise in consolidated net profit at Rs 228.6 crore for the October- December quarter, ruled out any headline tariff change in the short run.
It had reported net profit of Rs 200.98 in the third quarter of 2011-12 fiscal.
Total income of the Aditya Birla Group company, which is partly owned by Malaysia's Axiata Group, rose 11 percent to Rs 5,578.58 crore during the quarter, from Rs 5,030.82 crore in Q3, last fiscal.
Despite tepid numbers, this is the third straight quarter of earnings growth for the mobile operator.
"In spite of regulatory interventions impacting subscriber acquisition and value added services business model, we could report a sequential quarterly revenue growth of 5 percent. The margins were lower in Q3 due to inflationary costs like diesel and electricity price hike and higher expenditure on advertisements," Idea Cellular Managing Director Himanshu Kapania told reporters here this evening.
Despite the numbers being below Street expectations, the Idea counter closed 0.6 percent up at Rs 113.50 on the BSE, while the exchange's index, Sensex, shed 113 points.
On tariff hike plan, Kapania said it will review tariffs but ruled out headline tariff change in short-run. "We will wait and see, how low price operators decide on their tariff."
The quarterly revenue growth is led by expansion of voice minutes by 5.2 percent to 132.2 billion minutes, compared to 125.6 billion minutes in Q2, indicating consumer demand for voice telephony remains robust. The company clocked 2.9 million VLR (visitor location register) subscriber additions in Q3 against 0.6 million in Q2, despite implementation of stricter verification norms.
Contrary to expectations, the average realised rate per minute (ARPM) fell this quarter to 41.1 paise against 41.3 paise per minute in Q2. The challenge on ARPM is on account of fall in the non-voice revenue contribution to 14.6 percent, driven down 1 percent over the last quarter, by Trai's new VAS regulation, Kapania said.
Adverse currency movement has resulted in forex loss of Rs 13.3 crore during the quarter, as against a forex gain of Rs 18 crore in Q2, reflected in increased interest and finance cost (net).
In the 1,800 MHz spectrum auction in November, the company won back spectrum in all seven service areas for which licences were quashed by the Supreme Court, at a bid amount of Rs 1,984.8 crore for a period of 20 years, ensuring continuity of services to more than 8 million customers, Kapania added.
Idea continues to invest in long term value creators - it set up 2,961 new tower sites (2G+3G), expanded optical fibre network to 71,600 km and strengthened network capacities in NLD, ILD, ISP, data services and devices.
Of the 114 million subscriber base, the number of Idea customers adopting data services has grown to 21.75 million, contributing 5.7 percent to service revenue.
More from India
More from World
More from Sports
More from Entertaiment
- Cortana for Android available for public beta in US
- Xiaomi Redmi 2 Vs Redmi 2 Prime: Specification comparisons
- Middle class woes to continue, wholesale onion price shoots up to Rs 57 per kg
- Alleged land encroachment in Greater Noida: HC asks DM to decide representation in 3 months
- Watch: Review of Mahindra TUV300