"In a statement Tuesday, Gopal Vittal, MD and CEO, India & South Asia at Airtel, highlighted the continued financial stress in the industry - struggling with debt of almost Rs 5 lakh crore amid severe pressure on revenue and profits due to the price war - and said it will get worse in the ongoing October-December quarter due to a recent 57% reduction in the interconnect usage charges (IUC), which is paid by a telco on whose network a call originates to the one on which it terminates".
Analysts say despite a 76% drop in net profit for the September quarter, the Sunil Bharti Mittal-led company has shown strong defences against Reliance Jio. In its largest market, India, Airtel's revenues declined 13 per cent on year to Rs 16,728 crore primarily led by drop in mobile revenues of 16.8 per cent compared with last year. It had posted ₹1,461 crore in the year-ago period.
The consolidated revenues for just-ended quarter, at Rs. 21,777 crores, represented a year on year drop of 10.4 percent (reported drop of 11.7 percent) on an underlying basis (that is adjusted for Africa and Bangladesh divested operating units and tower assets sale), Airtel said. "This will eventually force operator consolidation and exits as the industry has witnessed in the recent past", Gopal Vittal, MD and CEO, India and South Asia, Bharti Airtel said in a statement. Mobile broadband customers rose 34 per cent to 55.2 million (41.3 million), Airtel said. Its net debt at the end of September quarter stood at Rs 91,480.1 crore, higher by 4.1 percent compared with previous quarter.
Nilanjan Roy, its global finance head, said as there was an explosion of data traffic in India, the company had decided it should hasten the rollout of fourth-generation (4G) technology, beside the building of additional capacity and fibre connectivity.
In constant currency terms, Africa underlying revenues grew by 2.8 per cent Y-o-Y.
For India, Bharti Airtel showed a drop of over 90 per cent in its net profit to Rs 121.1 crore (before exceptional items) for the quarter ended September 30, over Rs 2,095.9 crore in the same period past year. Mobile data traffic has grown by 83.8 per cent to 63 billion MBs in the quarter as compared with 34 billion MBs in the corresponding quarter past year.
Active Airtel Money customer base at 9.5 million, increasing the total transaction value on Airtel Money platform by 31.1 per cent to $ 4.9 billion.