auction in November 2012, where only 42% of the offered spectrum was sold, the Indian government reduced the spectrum price of unsold circles by 30% (mainly Delhi and Mumbai) and the spectrum price of CDMA by 50%. The government is planning to hold another auction of the 900MHz and 1800MHz spectrums in March 2013. The price of spectrum in 900MHz has been fixed at two times the price of airwaves in the 1800 MHz spectrum, although it is probable that the final price may be lower.
Bharti's nine months ended December 2012 (9M12) results were in line with Fitch's expectations. Revenue and EBITDA rose by 14% and 5% respectively year-on-year due to a growing Indian and African subscriber base. EBITDA margin, however, deteriorated by 200bps to 31% on higher network operating costs (+21%) and marketing cost (+22%) as the company rolled out its 3G network and competed aggressively to regain its lost revenue market share. Also, Bharti's leverage will benefit from its downward FY13 capex revision to USD2.5bn-2.6bn from USD2.8bn-3bn earlier.
Bharti Airtel profit sinks, misses estimates
(Reuters) Profit at India's top mobile network operator Bharti Airtel Ltd fell for the twelfth successive quarter, with higher costs dragging its results well below market expectations.
Bharti Airtel, controlled by billionaire Sunil Mittal, said consolidated net profit fell to 2.84 billion rupees ($53.39 million) in the fiscal third quarter that ended Dec. 31, from 10.11 billion rupees a year earlier.
Revenue rose 9.5 percent to 202.4 billion rupees, but the company was hit by foreign exchange losses, higher taxes and financing costs.
Analysts had expected the company to report net profit of 8.45 billion rupees on revenue of 202.79 billion rupees, according to Thomson Reuters I/B/E/S.
Shares in the company, valued at $24 billion, were down 2 percent at 0500 GMT, while the broader market was slightly up.
"Market conditions have been challenging in recent quarters due to pricing pressures and rising input costs, which have put enormous pressure on the sector and consequently the margins," Chairman Sunil Mittal said in a statement.
"However, the worst seems to be getting over, with corrections taking place in customer acquisition practices and the tariffs", he said.
For years, stiff competition in a crowded market has limited Indian telecoms companies' ability to raise prices. The outlook for bigger firms including Bharti Airtel has improved since an early 2012 court order to revoke