Telecom major Idea Cellular second quarter net profit surges, beats estimates

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Idea Cellular, part of the metals-to-financials the Kumar Mangalam Birla-led Aditya Birla conglomerate, said profit rose to Rs 4.4 bn. AP Idea Cellular, part of the metals-to-financials the Kumar Mangalam Birla-led Aditya Birla conglomerate, said profit rose to Rs 4.4 bn. AP
SummaryIdea Cellular profit surged 86% after it raised call prices in mobile phone market.

by 4 per cent, in the period under review. This helped company generate cash profit of Rs 1,455.6 crore, a growth of 18.2 per cent, further strengthening its balance sheet.

Finance cost was lower by Rs 25.7 crore at Rs 157.5 crore, while net debt fell from Rs 10,219.9 crore in Q1 to Rs 9,286.4 crore in Q2.

As competitive intensity declines and overcapacity phase comes to an inevitable end, visibility of spectrum quantum and pricing improves, Idea expects to consolidate its position in the telecom voice and data market, Kapania said.

Commenting on the QIP issue, Kapania said, "We have taken shareholders permission for QIP, but may not go ahead with the same. We have surplus funds of Rs 2,800 crore, which may be used to renew licenses of 9 circles, slated between December 2015 and April 2016."

He said there is no plan to acquire any assets as Idea has national operations and has enough spectrum.

Bigger Indian phone carriers such as Bharti Airtel Ltd , Vodafone Group Plc's local unit and Idea Cellular have cut discounts and raised some call prices this year after several of their smaller rivals were forced to exit or scale back by a court order on a massive licensing scandal.

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