New IUC regime hits Bharti Airtel profits: At Rs 759 crore, telco’s net down 11.12% in Q4FY21

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May 18, 2021 6:15 AM

The drop in revenues was mainly due to the new interconnect, bill and keep regime which kicked in from January. The net profit also came in below estimates despite an exceptional gain of Rs 440 crore during the quarter.

The company is targeting to have 20-25 million home broadband customers in the next couple of years.The company is targeting to have 20-25 million home broadband customers in the next couple of years.

Bharti Airtel, the country’s second largest telecom operator, on Monday saw its consolidated net profit declining 11.12% on a sequential basis at Rs 759 crore, missing analyst estimates, as its India mobile services revenues fell 4.7% quarter-on-quarter at Rs 14,079 crore.

The drop in revenues was mainly due to the new interconnect, bill and keep regime which kicked in from January. The net profit also came in below estimates despite an exceptional gain of Rs 440 crore during the quarter.

The company’s consolidated revenues were also behind estimates at Rs 25,747 crore, down 2.91% on a sequential basis. Bharti’s consolidated Ebitda at Rs 12,583 crore was up 3.33% compared with the preceding quarter but once again below estimates. Ebitda margin, however, expanded at 48.9% against 45.9% in the preceding quarter.

The zero termination charge regime kicking in from January also depressed Bharti’s average revenue per user (Arpu), which at Rs 145 was down 12.6% compared with the preceding quarter. However, if the previous (December) quarter’s Arpu is recast on the basis of the zero termination rate, it would come at Rs 146 against the reported Rs 166, so the q-o-q decline is only marginal.

The company’s Arpu and data usage per customer continues to be ahead of rival Reliance Jio and the best in the industry.

Bharti’s India revenues at Rs 18,338 crore were down 3.52% against the preceding quarter.

Minutes of voice usage per customer per month improved 2.5% q-o-q at 1,053 minutes. Data usage per customer per month was up 0.4% sequentially at 16,840 MB, which continues to be the strongest in the industry. Total data volume saw a jump of 8.9% q-o-q at 9,207,030 million Mbs.

The monthly churn, though, increased to 2.2% compared with 1.9% in the preceding quarter.

Of the company’s total 321 million subscribers, 179 million are now 4G users. The 4G subscriber addition saw a 8.3% jump on a sequential basis.

“Our services are the digital oxygen that the country needs in this challenging time as we experience a vicious second wave of Covid-19. I am grateful to our people who are doing all they can to strengthen our network experience and serve our customers braving massive odds. It is this relentless focus on customer obsession that has allowed us to deliver another consistent quarter in terms of performance.

Our mobile revenues grew at 19.1% y-o-y backed by 13.7 million 4G customer additions. We are seeing strong momentum in our homes business with 274k net adds. The enterprise segment delivered double digit growth. Our digital assets continue to scale and we are beginning to see strong traction in monetisation of these assets,” Gopal Vittal, MD and CEO, India and South Asia said.

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