Bharti Airtel Q4 profit slumps 78% at Rs 82.9 crore, lowest in 15 years
Bharti Airtel posted a 78% drop in its consolidated net profit at Rs 83 crore for the quarter ending March 2018, hurt by fierce tariff war and cut in international termination charges.business Updated: Apr 24, 2018 19:48 IST
Bharti Airtel Ltd posted its lowest quarterly profit in nearly 15 years on Tuesday, as a price war in the telecoms sector continued to hurt, while revenue was hit by a regulatory cut in international termination charges.
The entry of Reliance Jio, the telecoms arm of Reliance Industries Ltd, into India’s telecoms sector has set off a brutal price war among operators as they drastically cut prices to compete with Jio’s bottomed out plans.
Compounding to the industry’s woes, India’s telecoms regulator had also cut international termination charges (ITC) - paid by global long-distance operators to local carriers - to 30 paise from 53 paise, effective from February.
The company posted a 78% drop in its consolidated net profit at Rs 83 crore for the quarter ending March 2018, hurt by fierce tariff war and cut in international termination charges.
The Sunil Bharti Mittal-led telecom firm had registered a net profit of Rs 373 crore in the same period a year ago.
Total revenue dropped by 10.5% to Rs 19,634 crore in the fourth quarter of 2017-18 compared to Rs 21,935 crore in the corresponding period last fiscal, according to a company statement.
“The telecom industry continues to witness below cost, artificially suppressed pricing. Industry revenues were further adversely impacted this quarter due to the reduction in international termination rates,” Gopal Vittal, MD and CEO - India & South Asia, Bharti Airtel said in a statement.
For the full financial year that ended in March 2018, Airtel’s net profit came in at Rs 1,099 crore, over 71% lower than Rs 3,800 crore logged in FY2016-17.
Total revenue for FY2017-18 stood at Rs 83,688 crore, down by 12.3% than the previous financial year, said the company which competes with operators like Vodafone, Idea Cellular and newcomer Reliance Jio in the highly-competitive telecom market in India.