Bharti Airtel Beats Estimates For Third Straight Quarter
Mobile revenue dented by free services provided by Reliance Jio: Airtel
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- Bharti Airtel beat analyst estimates despite 5 percent year-on-year fall in profit.
- Revenue rose 3.4 percent to Rs 24,652 crore.
- Average revenue per user in India fell to lowest since the quarter ended December 2012.
- Well positioned to lead India’s data revolution: Gopal Vittal
- Stock rose 3.1 percent to Rs 321.6 as of 9:45 a.m.
Bharti Airtel Ltd.’s profit fell 5 percent, on a yearly basis, in a seasonally weak quarter. Unlike Idea Cellular Ltd., which under performed analyst expectations by 49 percent, Bharti managed to beat the Bloomberg consensus estimate by 19 percent.
Net profit for the quarter-ended September stood at Rs 1,461 crore, according to its filing on the stock exchanges.
Revenue rose 3.4 percent to Rs 24,652 crore on account of devaluation of the Nigerian currency. The net foreign exchange loss stood at Rs 302 crore in the quarter. The average revenue per user (ARPU) in India fell to Rs 188, lowest since the quarter-ended December 2012.
Earnings before interest, tax, depreciation and amortisation jumped 15 percent to Rs 9,460 crore on a year-on-year basis. EBITDA margin expanded by 375 basis points to 38.35 percent in the same period.
Revenue from data services rose 24 percent compared to last year to Rs 3,576 crore, while the data average revenue per user moved up by 4 percent to Rs 201. Data revenue per user remained largely stable compared to the last quarter.
Like Idea Cellular, Bharti reported a drop in average realisation in its voice as well data businesses. Data realisation per megabyte decreased 10 percent to 20.08 paise while voice realisation per minute fell 3 percent to 32.42 paise on quarter-on-quarter basis.
Bharti Airtel will maintain its leadership position in the data market despite growing competition, Gopal Vittal, the managing director and chief executive officer for India and South Asia said in the press release. The competitive intensity in the Indian telecom market has increased with the entry of Mukesh Ambani’s Reliance Jio Infocomm Ltd., which is offering 4G services nationwide free of cost.
Our mobile business has experienced a slowdown in growth due to free services being offered by a new operator. But we remain excited about the long term opportunity in India and believe that with the recently acquired spectrum, we are well positioned to lead India’s data revolution.Gopal Vittal, MD And CEO, India And South Asia, Bharti Airtel
Airtel added 4.5 million customers in the second quarter, taking its total customer base to 276.1 million as on September 30. To support this customer growth, Bharti Airtel acquired 173.8 MHz of spectrum in recently concluded auction for a total commitment of Rs 14,244 crore. The churn ratio, or the percentage of subscribers who discontinue their subscriptions, remained largely stable at 3.7 percent.
India’s largest telecom operator’s consolidated debt stood around Rs 98,813.5 crore, 3 percent lower when compared to June-ended quarter. The reduction in debt was complemented by 8.6 percent rise in cash profit, which stood at Rs 7,724 crore. In the same period, the company incurred capital expenditure of Rs 5,288 crore.
The company will evaluate the option to monetise a significant stake in Bharti Infratel Ltd., according to a separate statement filed after its board meeting. Bharti Airtel holds 71.96 percent stake in Infratel, and in the past, had sold stake to private equity investors led by Temasek, KKR and others.