Idea Cellular has posted a net loss of Rs 492.28 crore for the third quarter ended December 31, 2016, compared with a net profit of Rs 636.03 crore recorded during the same period a year ago.
In an obvious reference to Reliance Jio Infocomm, the Aditya Birla group company said it was impacted by free services from a new operator, while demonetisation had “minor effects”.
Earlier Bharti Airtel, the country’s largest telecom operator by users, had also said it was also impacted by RJio’s free services and demonetisation.
During the quarter under review, Idea Cellular’s total income fell to Rs 8,608.15 crore from Rs 8,990.64 crore posted during the year-ago comparable period, Idea Cellular said in a regulatory statement.
The Indian mobile industry witnessed an unprecedented disruption in the quarter of October to December 2016, primarily due to free voice and mobile data promotions by the new entrant in the sector, Idea said, adding the revenue key performance indicators and financial parameters of all mobile operators have “sharply declined”.
For the first time in its history, the flourishing Indian wireless sector is trending towards an annual revenue decline of 3-5 per cent in financial year 2017, compared with previous fiscal.
“The sector can expect to recover revenues only once the new operator starts charging for its pan India mobile services,” it said.
The company said it was forced to reduce voice rates by 10.6 per cent to 29.6 paisa per minute and drop its mobile data rates by 15.2 per cent to 15.9 paisa per MB on a sequential quarterly basis.
The voice minutes only grew by 7.3 per cent to 210 billion minutes, versus 195.5 billion minutes recorded during the sequential second quarter. The higher blended voice realization rate fall was also due to an outcome of the tsunami of minutes terminating on Idea’s networks from the new operator, it added.
On a consolidated basis, Idea Cellular also posted a net loss of Rs 383.88 crore for the quarter ended December 31, 2016, as against a net profit of Rs 659.36 crore recorded during the same period earlier.
The operator’s consolidated total Income fell to Rs 8706.37 crore from Rs 9,032.43 crore posted during December quarter of previous year.