Ebitda margin declined 9 bps q-o-q to 31.1%. Operating costs were above estimates primarily due to higher ad spends (subscriber acqn, servicing and marketing expenses up 70 bps q-o-q). Consolidated revenue grew 18.5% y-o-y and 4.6% q-o-q to Rs 6,613 crore (est Rs 6,573 crore), primarily driven by voice traffic (+4.1% q-o-q to 144.6b minutes vs estimate of 144.8b minutes).
RPM improved only marginally (+0.4% q-o-q to 44.9p vs our est of 44.6p) vs approximately 2% q-o-q increase in 2QFY14 and approximately 6% q-o-q increase in 1QFY14.
Data revenue increased 14% q-o-q led by 19% q-o-q increase in data traffic. Data as % of revenue increased from 8.7% in 2QFY14 to 9.5% in 3QFY14. However non-voice contribution remained flat q-o-q at 16.1% as non-data VAS revenue continued to decline.
Our Ebitda estimates are largely unchanged but PAT estimates have been downgraded by 2-5%. We expect an Ebitda CAGR of 16% over FY14-16E. The stock trades at EV/Ebitda of 5.4x FY15E. Maintain buy with a price target of Rs 200.