Himanshu Kapania, MD of the co add the call.Highlights by Capital Mkt
Sequentially, in June 2015 quarter revenues grew 4% to Rs 8798.35 crore primarily driven by a) 4.4 million active subscribers addition (VLR), b) expansion of voice minutes @ 5.8% clocking 195.8 billion minutes on Network and c) 15% Mobile data (2G+3G) volume growth to 62.7 billion Megabytes.Due to changes in the TRAI Interconnect (IUC) regulations (Amendmend XIth and XIIth) effective from March 01, 2015 primarily reducing mobile incoming IUC charges from 20p to 14p/min the revenue figures for June 2015 quarter are not comparable to earlier quarters.The gross revenue for June 2015 quarter is negatively impacted by around Rs 317.0 crore (y-o-y), due to IUC rate changes. Additionally, implementation of TRAI Roaming TTO (Sixtieth Amendment) effective from May 01, 2015 reducing the upper cap for national roaming voice call charges & SMS charges between 20%-75% & increase in service tax rate effective from June 01, 2015 from 12.36% to 14% have also impacted the financial results for this quarter.
OPM improved 30 basis points to 36.7% which saw OP rising 5% to Rs 3228.38 crore.Other income fell 34% to Rs 122.43 crore and interest cost rose 38% to Rs 401.63 crore. After providing for depreciation (Rs 1515.90 crore, up 2%), PBT fell 3% to Rs 1433.28 crore.After providing for taxation (down 5% to Rs 502.45 crore) PAT fell 1% to Rs 930.83 crore.The Voice rate realisation remained under pressure and fell sharply by 11.2% to 32.9p/min, including the impact of TRAI regulation changes and increase in service tax rate.
During the quarter, its average revenue per user (ARPU) was at Rs 182, up 1.7% versus Rs 179 (Q-o-Q) while voice revenue per minute declined for four straight quarters (down 11.3% in a year).44 lakh active subscribers addition, expansion of voice minutes at 5.8% clocking 195.8 billion minutes on network and 15 percent mobile data (2G+3G) volume growth to 62.7 billion MB drove revenue in June 215 quarter…Revenue Market Share (RMS) of 18.2% as on March 2015.In the 15 Established Service Areas, its RMS stands at a strong level of 21.3%.
The company carried around 2.15 billion minutes on a daily basis in June 2015 quarter.Idea is the sixth largest mobile telecommunications company (counted on operations in a single country) in the world based on number of subscribers.The net mobile data customer base has risen by 3.7 million to 37.2 million in June 2015 quarter.
Around 22.9% of overall Idea subscriber base use Idea 2G or 3G platform to access internet
The blended data Average Realisation Per MB (ARMB) fell y-o-y by 6.5% from 26.3p/Mb due to increased competition.The 3G subscriber base for the company has grown by around 90% over last one year.
Capex in June 2015 quarter is Rs 1367.4 crore excluding spectrum, Interest & exchange rate difference capitalization.Capex spend for the quarter was fully funded from quarterly cash profit of Rs 2553.1 crore.
Capex and net debt amounts reflecting in balance sheet are higher by Rs 55.1 crore each due to capitalisation of amount relating to foreign exchange difference during the quarter on long term loans taken for acquiring fixed assets.India today is fastest growing economies. India is largest target market for ICT. PM Modi has correctly identified digitalization to double GDP growth in a decade.Due to digitalization, online will replace paper
Cash economy will transform into cashless economy.As mobility market services expand, Indian telecom business will offers exciting growth opportunities in Mobile broadband & rural voice telephony.
Brand Idea with increasing consumer affinity, strong cash flows, Pan India 2G presence, expanding 3G network footprint & planned 4G network launch is gearing itself to strengthen its market position and improve standing across existing and emerging opportunities.Net Debt to annualised EBITDA ratio stands at 1.49.Net-Worth stands at Rs 23705.4 crore.It has an average (current and preceding three quarters) cash Profit of Rs 2250 crore per quarter provides a solid foundation to support the company’s growth plan.
Idea has also initiated multiple steps towards introduction of 4G LTE services on 1800 MHz spectrum band in 10 service areas, in a phased manner from calendar year 2016 onwards.It is also in the process of revisiting its existing Value Added Services offering and intends to introduce its own range of Digital Services (through inhouse development or partnering with others) across various categories like entertainment, information, communication, utilities and API services etc. in next financial year.500 million people in rural India still do not have sim cards.Idea’s lead over its customers has extended.Depreciation and interest cost grew due to interest charge for upfront payment for Mar’15 auction and for Delhi 900 MHz spectrum.Capex target for FY 2016 increased to Rs 60-65 billion from Rs 50-55 billion.Future growth should come from volume and rate improvement.Competition in voice is on the decline.Competition in mobile data will be more intense.For capex it is difficult to give guidance after FY 2016.