Bharti Airtel Q3 net profit sinks 72% at Rs 284 cr
Bharti Airtel profit sinks, misses estimates
(Reuters) Profit at India's top mobile network operator Bharti Airtel Ltd fell for the twelfth successive quarter, with higher costs dragging its results well below market expectations.
Bharti Airtel, controlled by billionaire Sunil Mittal, said consolidated net profit fell to 2.84 billion rupees ($53.39 million) in the fiscal third quarter that ended Dec. 31, from 10.11 billion rupees a year earlier.
Revenue rose 9.5 percent to 202.4 billion rupees, but the company was hit by foreign exchange losses, higher taxes and financing costs.
Analysts had expected the company to report net profit of 8.45 billion rupees on revenue of 202.79 billion rupees, according to Thomson Reuters I/B/E/S.
Shares in the company, valued at $24 billion, were down 2 percent at 0500 GMT, while the broader market was slightly up.
"Market conditions have been challenging in recent quarters due to pricing pressures and rising input costs, which have put enormous pressure on the sector and consequently the margins," Chairman Sunil Mittal said in a statement.
"However, the worst seems to be getting over, with corrections taking place in customer acquisition practices and the tariffs", he said.
For years, stiff competition in a crowded market has limited Indian telecoms companies' ability to raise prices. The outlook for bigger firms including Bharti Airtel has improved since an early 2012 court order to revoke permits of several operators, signalling the exit of some smaller companies from the market.
Bharti Airtel and Idea Cellular, India's No. 3 mobile carrier by revenue, recently raised call prices by withdrawing discounts. This week Idea reported a smaller-than-expected increase in quarterly profit as higher network operating costs ate into margins.
NEW SPECTRUM NEEDED
The government wants established operators to pay surcharges on their airwaves, which will mean a bill of almost $1 billion for Bharti, the country's No.1 operator by both revenue and number of subscribers, which also needs to buy new spectrum in an auction due in March.
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