Aditya Birla group company Idea Cellular has reported an 86 per cent rise in net profit for the second quarter ended September 30, driven by an increase in call rates, higher data spend by subscribers and cutbacks in promotional offers.
The country’s third largest telecom operator has recorded a net profit of Rs 447.6 crore for the quarter against Rs 240 crore in the year-ago quarter. Net revenues went up 19 per cent to Rs 6,323 crore (Rs 5,314 crore)
Capital raising plan
“We are on track to achieving consistent, profitable and competitive growth. The current trend of improving our position in the marketplace will continue for some time,” Himanshu Kapania, Managing Director, said at a press conference here on Thursday.
On a sequential basis, however, the company’s net profit declined 3.2 per cent, from Rs 462.7 crore. “Q2 is a seasonally week quarter for telecom firms due to monsoons and lack of power in some pockets of the country. As we add more rural subscribers, the impact is becoming more and more pronounced,” said Kapania.
The company said its move to clamp down on promotional minutes for new and existing customers helped improve average realised rate per minute by 8.3 per cent to 44.7 paise . Contribution of value-added services to revenues increased to 16 per cent, it said.
On a year-on-year basis, average minutes of usage went up to 368 from 359.
Akshaya Moondra, Chief Financial Officer, said that the company managed to reduce the net debt to EBITDA ratio to 1.33 from 1.39 in the quarter. This augurs well for its future capital raising plan as several of its licenses are up for renewal between 2015 and 2016, he added. The company has already taken an enabling resolution from its board for further issue of equity shares, to raise up to Rs 3,000 crore, by way of qualified institutional placement.