Anil Ambani-led Reliance Communications today reported consolidated net loss of Rs 531 crore for October-December 2016, mainly due to free 4G services being offered by his elder brother Mukesh Ambani’s Reliance Jio. The company had posted net profit of Rs 303 crore in the same period a year ago. “The company suffered a net loss of Rs 531 crore during the quarter primarily on account of… unprecedented competitive intensity. This was the first full quarter after the company’s complete shutdown of its profitable CDMA operations,” RCom said in a statement. Reliance Jio launched its full-fledged free 4G service on September 5.
RCom added that there was an increase in amortisation and interest expense aggregating Rs 278 crore on account of capitalisation of 850 MHz spectrum liberalisation fee, which too adversely impacted its financials. The consolidated revenue of RCom fell 11 per cent to Rs 4,822 crore in the reported quarter, from Rs 5,420 crore in the corresponding period of the previous fiscal. The company reported decline of 10.5 per cent in revenue realisation from voice calls despite minutes of usage going up on its network by 4.3 per cent to 102.1 billion minutes compared with the previous quarter.
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RCom reported a decline of 0.6 per cent average revenue per user to Rs 154 and drop of 10 per cent in data traffic on its network as against the previous quarter. The stock closed at Rs 34.6, down 2.26 per cent from its previous close, on BSE on Friday.