BackIdea Cellular Q1 net profit doubles to `463 crore
Company says voice minutes expanded 12.5% to 147.3 billion, supported by customer additions of 7.8 million
Premium(Pradeep Gaur/Mint)
Mumbai: Idea Cellular Ltd, India’s third-largest mobile-phone company by revenue, said on Thursday that net profit nearly doubled in the quarter ended 30 June from a year earlier, beating analyst estimates and reinforcing a trend signalled by bigger rival Bharti Airtel Ltd that the telecom industry may have turned the corner.
Net profit rose to ₹ 463 crore in the three months from ₹ 234 crore a year earlier, bolstered by higher tariffs, less competition from smaller firms and increased customer additions.
A subsidiary of the Aditya Birla Group, the telecom operator’s consolidated revenue rose 18.8% to ₹ 6,539 crore from ₹ 5,503 crore.
A Bloomberg poll of analysts had pegged net profit at ₹ 394.2 crore and sales at ₹ 6,346.14 crore.
Earnings before interest, tax, depreciation and amortization (Ebitda). an indicator of operating profitability, increased to ₹ 2,076 crore from ₹ 1,435.5 crore.
Bharti Airtel on Wednesday reported a drop in quarterly net profit, but overall revenue increased by 9.2%. India mobile revenue rose 10.9%, digital revenue 34% and business-to-business services revenue 17.9%, signalling that the worst may be over for the telecom industry.
Idea Cellular’s profit would have been higher in the absence of exceptional charges, analysts said.
“Idea reported yet another quarter of very strong numbers with adjusted Ebitda growing by approximately 20% quarter on quarter and beating our estimate by—12% primarily driven by 6% improvement in the revenue per minute," Rikesh Parikh, vice-president, equities, Motilal Oswal Securities Ltd, said in an emailed response.
“Reported PAT (profit after tax) would have been higher but for a one-off provision for licence or wireless planning and co-ordination charges and higher depreciation due to change in useful life of certain fixed assets."
Idea said voice minutes expanded 12.5% to 147.3 billion, supported by customer additions of 7.8 million. The cumulative customer base for the telecom firm was 125 million on 30 June, up from 117 million a year ago. Depreciation and amortization charges stood at ₹ 1,135 crore, up 12%.
The company also disclosed its plan to raise ₹ 3,750 crore from Malaysia’s Axiata Group Bhd and qualified institutional buyers through a share issue. While ₹ 750 crore will be raised through preferential allotment, the rest will come from qualified institutional placements. Axiata already holds a minority stake in Idea.
Idea ended at ₹ 167.35, down 0.98%, while India’s benchmark Sensex fell 0.15% to close at 19,317.19 points.
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