Reliance Communications (RCom) has posted a 3.25 per cent dip in net profit to Rs 1,454.3 crore on a consolidated basis for the quarter ended March 31, 2009, after adjustment of the shares of minority interests and associates. The Anil Ambani group company has also provided a capacity expansion indication of Rs 10,000 crore for the current financial year (FY10).
The integrated telecom service provider’s net profit for the comparable quarter of the previous financial year stood at Rs 1,503.36 crore.
In comparison, the country’s leading telecom service provider, Bharti Airtel, has recorded a 7.8 per cent rise in consolidated net profit to Rs 2,047.7 crore, while Idea Cellular has posted a marginal dip of 0.87 per cent in net profit to Rs 274.3 crore.
RCom’s total income rose to Rs 6,123.7 crore for the quarter under review, up from Rs 5,311.4 crore for the same period of the previous financial year.
“Reliance Communications completed the world’s largest network rollout in FY’09 ahead of schedule and at competitive cost, around 35 per cent lower than the original guidance (planning). We are confident of improved performance in the coming years,” said RCom Chairman Anil Ambani.
For the year, Rcom’s net profit after adjustment of shares of minority interests and associates was Rs 5,907.55 crore (Rs 5,401.1 crore last year) on total income of Rs 22,941.1 crore (Rs 19,067.8 crore last year).
According to Frost & Sullivan (South Asia & Middle East) Industry Analyst, ICT Practice, Nanditha Krishna: “As we look at all the segments – wireless, broadband and DTH – the company has done significantly well. The financial crisis has not impacted the telecom sector and for RCom there is Rs 400 crore Q-o-Q increase in revenue. This is important as bookings happen in Q3 and the impact is seen in Q4.”
The company has also provided a capex guidance of Rs 10,000 crore for the current financial year, down from the Rs 19,000 earmarked for the previous financial year. “This year’s capex excludes investments for 3G and WiMax operations,” RCom Group Managing Director Satish Seth said.
A Mumbai-based analyst, on condition of anonymity, said the previous year’s capex was high as it included the company’s GSM rollout. “Looks like RCom will have to raise further debt to participate in 3G and WiMax rollouts,” he added.
The company’s average revenue per user (ARPU), a yardstick of growth, fell 10.75 per cent to Rs 224 (from Rs 251), while minutes of usage (MoU) dipped 9.26 per cent to 372 per user (410 earlier) during the quarter. In comparison, Bharti Airtel’s ARPU slipped 5.9 per cent to Rs 305 and MoU fell 4 per cent to 485 minutes, while Idea Cellular’s ARPU fell 4.5 per cent to Rs 254 a month and MoU fell 3 per cent to 402 minutes.
