Idea Cellular declined 1.26% to Rs 180 at 9:30 IST on BSE after net profit rose 27.8% to Rs 821.23 crore on 18.04% rise in total income to Rs 8868.61 crore in Q1 June 2015 over Q1 June 2014.
The result was announced after market hours yesterday, 21 July 2015.
Meanwhile, the BSE Sensex was down 87.37 points, or 0.31%, to 28,094.77.
On BSE, so far 1.08 lakh shares were traded in the counter, compared with an average volume of 3.39 lakh shares in the past one quarter.
Shares of telecom company hit a high of Rs 186.50 and a low of Rs 180 so far during the day. The stock had hit a record high of Rs 203.90 on 17 April 2015. The stock had hit a 52-week low of Rs 138.15 on 16 December 2014.
Due to changes in the TRAI Interconnect (IUC) regulations (Amendment XIth and XII th) effective from 1 March 2015 primarily reducing mobile incoming IUC charges from 20 paise to 14 paise/min the revenue figures for this quarter are not comparable to earlier quarters. The gross revenue for Q1 June 2015 is negatively impacted by Rs 317 crore (compared to Q1 June 2014), due to IUC rate changes. Additionally, implementation of TRAI Roaming TTO (Sixtieth Amendment) effective from 1 May 2015 reducing the upper cap for national roaming voice call charges & SMS charges between 20%-75% & increase in service tax rate effective from 1 June 2015 from 12.36% to 14% have also impacted the financial results for this quarter.
Inspite of the above, Idea starts the new financial year with 16.4% growth in gross revenue to Rs 8796.50 crore in Q1 June 2015 over Q1 June 2014. On the sequential quarterly basis the gross revenue has grown by 4.5%(normalized for IUC change QoQ revenue growth of 6.9%) primarily driven by 4.4 million active subscribers addition (VLR), expansion of voice minutes at 5.8% clocking 195.8 billion minutes on Network and 15% Mobile data (2G+3G) volume growth to 62.7 billion Megabytes.
Idea clocked 24.9 million annual net VLR subscriber additions between July 2014 to June 2015 against 18.6 million additions in the same period previous year and is now servicing 165.8 million quality consumers in India. Competitively, the company has improved its standing with Customer Market Share (on VLR) at 18.9% (May 2015) and Revenue Market Share (RMS) at 18.2% in Q4 March 2015, an RMS improvement of over 1.6% compared to Q4 March 2014.
Despite the large subscriber addition the quality of Idea's overall consumer base has been steady with average revenue per user (ARPU) at Rs 182 (v/s Rs 181 in Q1 June 2014) and Voice usage per subscriber at 408 minutes (v/s 401 minutes in Q1 June 2014).
The Voice rate realisation remained under pressure and fell sharply by 11.2% to 32.9 paise/min, including the impact of TRAI regulation changes and increase in service tax rate, but the elasticity of demand compensated the rate decline with 18.5% minute growth in Q1 June 2015 versus Q1 June 2014. However, because of mobile data growth the blended 'Average Realisation per Minute' (ARPM) was lower by only 1.3% to 44.5 paise/min in Q1 June 2015 from 45.1 paise/min (Q1 June 2014) and the Non-Voice revenue share increased to 26.1% this quarter (17.8% in Q1 June 2014).
The net mobile data customer base has risen in this quarter by 3.7 million to 37.2 million, with 22.9% of overall Idea subscriber base using Idea 2G or 3G platform to access internet. Due to increased competition, the blended data 'Average Realisation Per MB' (ARMB) has sharply fallen by 6.5% from 26.3p/Mb in Q1 June 2014 to 24.6p/Mb in Q1 June 2015. But, the higher mobile data usage per data customer at nearly 600 MB/sub (409 MB/sub in Q1FY15) helped improve the blended Mobile data ARPU (2G+3G) to Rs 147 (v/s Rs. 108 in Q1 June 2014).
The 3G subscriber base for the company has grown by 90% over last one year, with addition of 7.9 million new 3G data customers, now servicing overall 16.7 million 3G data customers. Over last one year, 3G data volume growth led the growth of overall Mobile data traffic (2G+3G) by nearly 1.9 times from 32.5 million Megabytes in Q1 June 2014 to 62.7 million Megabytes in Q1 June 2015.
To support this exponential Voice & mobile data growth, Idea capex spend in Q1 June 2015 is Rs 1367.40 crore (excluding spectrum, Interest & exchange rate difference capitalization); adding 3,208 2G sites, 3,330 3G sites and 1,700 km of OFC network. Today Idea covers nearly 80% of Indian population at 95 crore for GSM services and 27.50 crore Indian population on own spectrum 3G services. The capex spend for the quarter was fully funded from quarterly cash profit of Rs 2553.10 crore.
Inspite of higher network expansion & multiple cost inflationary pressures, Idea standalone earnings before interest, tax, depreciation and amortization (EBITDA) grew by 31.1% in to Rs 2961.30 crore, helping EBITDA margin to improve by 3.8% to 33.7% in Q1 June 2015 over Q1 June 2014.
The company's consolidated net profit rose 27.82% to Rs 930.83 crore on 17.45% rise in total income to Rs 8920.78 crore in Q1 June 2015 over Q1 June 2014.
Idea Cellular's consolidated earnings before interest, tax, depreciation and amortization (EBITDA) rose 28.9% to Rs 3228.40 crore in Q1 June 2015 over Q1 June 2014. EBITDA margin improved by 3.6% to 36.7% in Q1 June 2015.
The company is slated to launch its Kolkata 3G services by end of this calendar year. Idea has also initiated multiple steps towards introduction of 4G LTE services on 1800 MHz spectrum band in 10 service areas of Kerala (10 MHz), Maharashtra & Goa, Andhra Pradesh, Karnataka, Madhya Pradesh & Chhattisgarh, Punjab, Haryana, North East, Tamil Nadu and Orissa (5MHz each), in a phased manner from calendar year 2016 onwards. The company is also in the process of revisiting its existing Value Added Services offering and intends to introduce its own range of 'Digital Services' across various categories like entertainment, information, communication, utilities and API services etc. in next financial year.
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