Bharti Airtel net profit up 29% at ₹107.2 crore in March quarter; revenue rises 6.2% to ₹20,602.2 crore
Airtel did not divulge its average revenue per user details
Bharti Airtel Ltd’s fiscal-fourth quarter profit rose 29% from a year earlier because of a one-time gain of ₹2,022.1 crore and a tight control on sales and marketing expenses amid a tariff war with rival Reliance Jio.
Net profit rose to ₹107.2 crore in the three months ended 31 March from ₹82.9 crore in the year earlier.
However, profit fell 63% to ₹409.5 crore for the year ended 31 March from ₹1,099 crore in the previous year.
The results underscore the sustained struggle of Bharti Airtel and other telecom operators in India to grow profits despite recording higher data and voice consumption.
Bharti Airtel’s consolidated revenue from operations for the fourth quarter grew to ₹20,602.2 crore from ₹19,394 crore in the year ago period. Its India wireless business posted a revenue of ₹10,632.3 crore the March quarter, up from ₹10,353.2 crore in the year-ago period.
In comparison, Reliance Jio generated ₹11,106 crore in operating revenue in the March quarter, beating Bharti Airtel on this metric.
The company’s India wireless business posted a loss of ₹1,377.8 crore in the March quarter, almost triple the ₹482.2 crore loss it posted in the year-ago period. However, the March quarter numbers are better than the ₹1,903.2 crore loss the company reported in the preceding December quarter.
“If you look at earnings, the losses seem to be coming down quarter on quarter and the company shows an improving trend. However, the pressure on India wireless business continues to remain," a Mumbai-based analyst said, requesting anonymity.
The launch of low-cost tariff plans by Reliance Jio, a unit of Reliance Industries Ltd, in September 2016, forced rivals to drop their rates, hurting profit margins.
Smaller companies were forced to either shut shop or get acquired, leaving just Airtel, Jio and the merged entity of Vodafone and Idea to compete in the Indian market.
Jio had 306.7 million users as of 31 March.
The company did not disclose other details such as average revenue per user, data traffic and 4G customer base, and shared only the audited financial results as it is proposing to make a rights issue for which statutory and regulatory approvals are awaited.
The performance of the company’s Africa unit has proved to be a beacon of hope as it battles Jio in its home market. Last week, Airtel announced the earnings for the Africa unit which swung to a quarterly profit from a year-earlier loss because of an increase in transaction value on its Airtel Money platform and higher data consumption on its network.
The Africa operations posted a net profit of $83 million in the March quarter, compared to a loss of $49 million a year earlier.
The improved earnings is significant for Bharti Airtel’s Africa arm, which is gearing up for an initial share sale in June-July.