The country’s largest telecom operator, Bharti Airtel, on Thursday beat analyst estimates by posting a consolidated net profit of Rs86 crore for the October-December quarter — down 27.73% compared to the preceding quarter — on the back of a Rs 1,017-crore exceptional gain largely on account of deconsolidation of Airtel Payments Bank.
Before this exceptional gain, the company registered a net loss of Rs1,041 crore, wider than Rs965 crore (before exceptional gain) in the preceding quarter. The Bloomberg consensus estimate had pegged Airtel’s consolidated net loss at Rs 905 crore.
The most striking aspect during the quarter was the company losing 48 million users on account of hiking the minimum monthly recharge amount to Rs35. These are low 2G users and the company had expected to lose around 30-40 million such users. As a result, Bharti’s total subscriber base has come down to 284 million from 332 million earlier. On the basis of subscriber number, Reliance Jio is snapping at its heels with a user base of 282 million.
The loss of low-end subscribers though did improve its Arpu a bit which is expected to improve further during the January-March quarter as the full benefit of removing such subscribers did not accrue during the quarter.
The competitive pressure on the company since the commercial launch of Reliance Jio, which has led to a tariff war, continues and was reflected in the earnings of the India business, which recorded a net loss of Rs972 crore, lower than Rs1,646 crore loss it posted in the preceding quarter.
The India mobile services revenue were also down 0.6% sequentially at Rs10,189.4 crore, while India revenues declined 1.01% at Rs14,768 crore.
Consolidated revenues during the quarter grew 0.47% on a sequential basis to Rs20,519 crore, which was slightly below expectations. Ebitda at Rs6,307 crore was up 0.57% compared to the preceding quarter but above estimates, while margin was 30.7% against 31.1% in the preceding quarter, again above estimates.
Bharti Airtel’s MD and CEO, India and South Asia, Gopal Vittal, said, “Our simplified product portfolio and premium content partnerships have played out well during the quarter, translating into one of our highest ever 4G customers additions of 11 million plus.”
On key metrics, blended Arpu at Rs104, up 4.1% on a sequential basis, and minutes of usage per customer for voice increased by 5.8% to 726 minutes. Total minutes on network jumped 1.4% to 702,881 million minutes on a sequential basis.
Total data volume rose 20.9% on a quarter-on-quarter basis to 32,16,897 million Mbs. Data usage per customer also jumped 14.2% to 10,528 Mbs on a sequential basis.