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Idea Cellular has posted a net profit of ₹509 crore on a standalone basis for the first quarter ended June 30, compared with a net loss of ₹617 crore in the same period a year ago. The company’s revenue fell 27.9 per cent to ₹5,889 crore from ₹8,167 crore in the same quarter of last financial year.
In the first quarter, Idea Cellular posted a consolidated net profit of ₹256.50 crore, compared with a loss ₹814.90 crore, thanks to a one-time gain from the sale of its telecom towers.
During the quarter, the country’s mobile industry continued to remain under pressure from heavily discounted unlimited voice and bundled data plans and subsidised 4G feature phone offerings from one of the operators, forcing commensurate response from other players to retain subscribers, the Aditya Birla Group company said in a statement.
At present, the sector offers unlimited voice and data bundles at unsustainable below-cost price levels impacting the financials of all operators. As existing customers continue to prefer lower value deep discounted unlimited voice and bundled data plans, the Average Revenue Per User (ARPU) remains under pressure, it added.
The revenue for the quarter declined mainly on account of the ARPU trending downwards, after adjusting for impact of exclusion of one-month tower revenue (on completion of sale transaction of Idea standalone towers to ATC on May 31, 2018) and the full quarter impact of the international IUC rate reduction.
Idea’s EBITDA for the quarter stood at ₹ 659 crore and ARPU at ₹ 100 as against ₹ 105 in Q4FY18. Its visitor location registry subscribers stood at 203.4 million as of June 30, with a market share of 20.9 per cent (May 2018), an improvement of 1.4 per cent compared with May 2017.
Idea-Voda merger
Following the receipt of the final approval from the Department of Telecommunications, the company is in the final phase of merging itself with Vodafone, it said. The combined entity, to be named Vodafone Idea, will be India’s largest mobile operator and the second largest in the world, with nearly 408 million subscribers.
Both the companies, using each other’s infrastructure and having intra-circle roaming arrangements, are already sharing nearly 66,000 sites.
“With the exit of sub-scale operators, consolidation of industry structure is nearly complete. Also, with the introduction of bundled plans, Indian mobile customer’s habits has permanently settled at higher consumption of voice and data services,” it added.
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