Bharti Airtel Q3 profit slides 54% to Rs504 crore as price war with Jio bites
Bharti Airtel’s profit for the third quarter declined amid competition with Reliance Jio’s free services
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New Delhi: Bharti Airtel Ltd on Tuesday posted a 54.5% decline in quarterly net profit as free services offered by new entrant Reliance Jio Infocomm Ltd took its toll on India’s largest telecom services provider.
Net profit fell to Rs503.6 crore in the three months ended 31 December from Rs1,108.2 crore in the year-ago quarter, the company said. Analysts had expected the company to post a profit of Rs1,087 crore, according to Thomson Reuters data.
Revenue declined by 3% to Rs23,335.7 crore in the period. Earnings before interest, tax, depreciation and amortisation—an indicator of operating profitability—increased to Rs8,570.5 crore from Rs8,474.9 crore a year ago.
Tycoon Mukesh Ambani’s Reliance Jio Infocomm launched its services in September with a range of freebies. In December, it said it will provide free voice calling, text messaging and data services until the end of March, extending its inaugural offer by three months, as it sought to win more customers from rivals. In response, rivals have had to lower prices to retain their customers.
Bharti Airtel’s mobile data average revenue per user (ARPU) fell to Rs175 in the December quarter from Rs200 in the year-ago period. Data volume grew 28.3% year on year. Mobile data customer increased to 37.7 million from 30.9 million.
Voice ARPU fell to Rs123 at the end of December from Rs137 a year ago. The number of minutes spent on calls on its network grew by 13.7% in the same period.
Bharti Airtel shares fell 1% to Rs316.20 on the BSE on a day the benchmark Sensex gained 0.95% to 27,375.58 points. The earnings were announced after the close of trading.