IDEA TELECOM Sees a HeavyY Drop by 9% on weak Q2

Idea cellular, India’s third largest telecom has seen a drop in its profit by 9%.  It has been named as one of the best mobile operators in India with its extraordinary networking services to its customers.  Idea Telecom has seen a heavy drop by 9% in the strong market after the telecom operator outlined weak earnings in the September quarter. Idea Telecom detailed a 13 per cent subsequent drop in its net profit of Rs. 809 crore on revenues of Rs. 8, 689 crore.  It fell up to 1.2 per cent compared with the June quarter.  As per the NDTV analysis, the analysts had estimated Idea cellular net profit at Rs 826 crore on revenues of Rs. 8, 768 crore.  The main drop was in the call rates for the idea telecom.  With the increasing competition day-by-day between different operators in the segment of mobile data, idea cellular has seen the drop.  With every mobile operator coming up with new and attractive offers to its customers in mobile data, idea telecom is facing a great challenge.  

Idea’s Ebitda margin or operating margin fell 150 basis points subsequently to 35.2 per cent, domestic brokerage Religare said in a note to clients.  Along with it, brokerage has cut its target price on Idea to Rs. 150 from Rs. 190.


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Fall in Idea’s Revenue

Idea’s revenues have seen a subsequent drop of about 5.4% in its Minutes of Uses (MOU) and 9.6% year-on-year fall in voice pricing.  The Average Mobile Revenue Per User (ARPU) dropped to about Rs. 175 on Rs. 182 in the June quarter.  

Data revenue growth of Idea is reduced to 83% year-on-year compared to 93% in the June quarter and 100% in the March quarter.  Slowly it has reduced to 5% and average revenue per MB has fallen down to 5% subsequently to 23.4 paise.  

Along with these falls, as of 2.40 p.m., Idea cellular shares are 8.39% lower at Rs 139.15 compared to 0.40% gain in the Nifty.