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Idea Cellular Q4 consol net up 3%, beats f’cast

Idea Cellular Q4 consol net up 3%, beats f’cast
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First Published: Mon, Jun 13 2011. 07 00 PM IST
Updated: Mon, Jun 13 2011. 07 00 PM IST
New Delhi: Idea Cellular , India’s fifth-biggest mobile carrier, reported a better-than-expected 3% rise in consolidated quarterly profit, helped by strong subscriber growth and steady call prices.
Outlook for companies in the world’s fastest-growing and the second-biggest mobile market has improved as call prices stabilised last year after a fierce price war that had led to sharp tariff cuts .
Idea and its rivals are also betting on selling more data services after they started third-generation (3G) networks in recent months. Data services offer higher margins than voice, which has been the mainstay of Indian mobile firms.
Idea, which last year spent about $1.3 billion in an auction to buy 3G radio airwaves, started the services in late March this year. The firm, which holds 3G licences in 11 of India’s 22 telecoms zones, said it had launched services in nine of them.
Idea, part of the cement-to-retail conglomerate Aditya Birla Group, said consolidated net profit rose to Rs 275 crore ($61 million) for its fiscal fourth quarter ended March, from Rs 267 crore reported a year earlier.
Revenue rose 26% to Rs 4235 crore from a year earlier for the Mumbai-based firm that added more than 9.6 million subscribers between January and March and had about 92 million total users at end-April.
A Reuters poll of 10 brokerages had on average expected net profit of Rs 248 crore on revenue of 41.6 billion.
Idea is not linked to the multi-billion dollar telecoms licensing scam that has rocked the government and businesses. But companies such as Idea and its bigger rivals Bharti Airtel face risk of steep increase in 2G spectrum prices as India overhauls telecoms rules.
Idea is also involved in a legal tussle with the country’s telecoms ministry, which earlier this year obtained a court order to stay Idea’s takeover of a smaller telecoms firm Spice, a deal that has already been closed and operations have been merged.
Idea had in 2008 agreed to buy Spice in a three-way deal that also gave Malaysia’s Axiata about a fifth of Idea.
Before of the earnings announcement, shares in Idea Cellular, valued at about $5.3 billion, closed 0.14% lower in a Mumbai market that ended little changed.
Idea shares are 3.5% up this year, outperforming a nearly 11% fall in the main index . Bharti Airtel shares have risen 5.2% this year.
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First Published: Mon, Jun 13 2011. 07 00 PM IST