Bharti Airtel, India’s biggest telecom operator, reported a 69 per cent drop in March quarter profit, missing Street expectations as a price war launched by new comer Reliance Jio last year weighed on its earnings.
Bharti Airtel’s consolidated net profit fell to Rs. 471 crore in the three months to March 31, 2017 from Rs. 1,529 crore a year ago, Bharti said in a statement on Tuesday. Analysts on an average had estimated its net profit at Rs. 528 crore, according to Thomson Reuters data.
Bharti Airtel’s revenue dropped 12 per cent to Rs. 21,935 crore for the January-March quarter compared to Rs. 24,960 crore in the year ago period.
The drop in Bharti Airtel’s consolidated revenue was due to 7 per cent annual decline in its India revenue to Rs. 17,036 crore, which was primarily led by 11.4 per cent drop in mobile revenue.
“Mobile market remains turbulent in the current quarter as well due to free offering by a new operator,” India’s biggest telecom operator said in a press release.
Reliance Jio, owned by India’s richest man Mukesh Ambani, launched its free voice and 4G data services in September 2016 and had extended it till March 31, 2017, sparking a price war which forced incumbent telecom players to slash their data and voice call prices to retain existing customers.
Although Bharti Airtel added nearly 80 lakh new mobile subscribers in the March quarter, its overall revenues fell as average voice revenue per user (ARPU) dropped 8.4 per cent sequentially to Rs. 158 from Rs. 172 in the December quarter. Its voice realization per minute declined 18 per cent to 24.28 paise as against 29.42 paise in the October to December quarter.
Meanwhile, average data revenue per user of Bharti Airtel dropped 7 per cent to Rs. 162 compared to Rs. 175 in December quarter as average data realization per MB plunged 32 per cent to 12.20 paise (against 17.97 paise in December quarter). (With agency inputs)