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Impacted by a sharp reduction in interconnect charges, Idea Cellular’s consolidated net loss widened to ₹1,285 crore in the third quarter ended December 31, 2017, making it the operator’s fifth consecutive quarterly net loss. The Aditya Birla Group company had posted a net loss of ₹384 crore during the comparable year-ago quarter.
Idea’s total income on a consolidated basis fell to ₹6,552 crore, compared with ₹8,706 crore recorded during the third quarter of the previous financial year. In the quarter under review, the company’s net profit fell to ₹1,352 crore on a standalone basis, from ₹479 crore recorded during the year-ago quarter.
The quarter was impacted by reduction of Interconnect Usage Charges (IUC), sustained rate pressure and industry consolidation, and hence cannot be compared with earlier period, the company said in a statement.
The Telecom Regulatory Authority of India had slashed domestic IUC to 6 paise per minute from 14 paise, effective October 1, 2017. The fall in IUC impacted Idea’s revenue and EBITDA for this quarter by ₹820 crore and ₹230 crore, respectively.
During the quarter, the company — which is the third largest in the country with a Revenue Market Share of 16.2 per cent (Q2FY18) — rolled out nearly 10,000 broadband sites. Over the last two years, Idea added 96,020 broadband (3G and 4G) sites, taking its overall broadband sites to 143,565.
The company, in which Axiata Group holds 19.73 per cent stake, is also on track to launch its own Voice over LTE (VoLTE) in March in main markets, it added.
The operator’s capital expenditure for the current quarter stood at ₹1,750 crore, while it raised capex guidance for the current fiscal to ₹7,000 crore from the earlier ₹6,000 crore.
Idea’s net debt as of December 31, 2017, stood at ₹55,781.8 crore. This included a large component of debt from the Department of Telecommunications, under deferred payment obligation for spectrum acquired in auctions.
Merger update On its proposed merger with Vodafone India, Idea said the consolidation is in the final leg of regulatory approvals and is expected to be completed in the first half of calendar year 2018. On March 20, 2017, Vodafone Group and Idea Cellular agreed to combine their operations in India (excluding Vodafone’s 42 per cent stake in Indus Towers) to create the country’s largest telecom operator.
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