New Delhi: Telecom operator Idea Cellular on Thursday posted a loss of Rs 815.9 crore in the first quarter ended 30 June, impacted by sustained pressure from disruptive tariffs of Reliance Jio.
This is the third straight quarter loss for the Aditya Birla group firm as it has not been able to recover from the pressure of aggressive tariff war triggered by Mukesh Ambani-led Reliance Jio Infocomm.
Idea Cellular had posted a profit of Rs 217.1 crore in the same period a year ago.
"The upheaval in the Indian wireless industry continued in the first quarter of financial year 2018, despite the new entrant slowly migrating from 'free services' to 'paid services' but with heavily discounted unlimited voice and data pricing plans," Idea said in a statement.
The company's financial performance, however, did not show any signs of recovery despite Reliance Jio ending free 4G service offer in March. On a quarterly basis, its January-March 2017 loss of Rs 325.6 crore further widened in the April-June period.
Total revenue of Idea also declined by about 14 percent to Rs 8,181.7 crore in the reported quarter from Rs 9,552.4 crore it posted in the corresponding period of 2016-17.
The company said that to counter aggressive tariff war, Idea also introduced similar competitive unlimited price plans, which are likely to result in decline of industry revenues, although the impact of the same is expected to be more pronounced on non-4G operators.
"These aggressive tariff offerings by Idea, led by unlimited voice and data bundled plans, resulted in steep decline of voice and mobile data realisation rates," the statement said.
It added that volume growth in both mobile voice and data segments compensated the fall in realisation of rates.
Idea said its mobile data volume witnessed a meteoric growth of 99.1 percent on sequential basis as its wireless broadband network carried 252.8 billion mega bytes of data in the reported quarter. However, the mobile data rate saw a decline of 52.9 percent, falling to as low as 5.4 paise per MB compared to 11.5 paise in January-March 2017 period.
The net debt of the company at the end of 30 June, 2017 stood at Rs 53,920 crore which includes a large component of debt for payment of spectrum that it won in different auctions.
Shares of Idea closed at Rs 92.65 a unit, down by 2.11 percent compared to previous close on BSE on Thursday.
(Disclosure - Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd)
Updated Date: Jul 27, 2017 18:26 PM