Reliance Comm Q4 net up 47 pc
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N.Sukumar
Apr 30, 2008, 8:08:47 AM4/30/08
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NEW DELHI: Reliance Communications, India's No. 2 mobile operator,
beat forecasts with a 47 percent jump in quarterly net profit as it
added more users in the world's fastest-growing wireless market,
sending its shares up 2 percent.
India overtook the United States as the biggest market for wireless
services after China, with a record 10.2 million people signing up for
mobile phones in March.
Local call tariff of as low as U.S. 1 cent a minute and availability
of cheaper handsets has seen India's mobile phone users soaring 25
times between 2002 and 2007.
Yet, only 22 percent of India's more than a billion people own mobile
phones and operators have started expanding to smaller towns and to
rural areas where 70 percent of the people live. Reliance
Communications, part of the Anil Dhirubhai Ambani Group, added 4.8
million mobile users between January and March taking its total to
45.8 million subscribers.
The company, which lags leader Bharti Airtel said on Wednesday net
profit rose to 15.03 billion rupees ($372 million) in the fiscal
fourth quarter ended March 31 from 10.24 billion reported a year
earlier. "We are confident of improved performance in the future,"
Chairman Anil Ambani said in a statement. Earnings before interest,
tax, depreciation and amortization (EBITDA), a key performance gauge,
rose 41.7 percent to 23.16 billion rupees, while EBITDA margins rose
to 43.6 percent from 41.5 percent in the year-ago quarter. Revenue
rose to 53.11 billion rupees from 39.37 billion.
A Reuters poll of 10 analysts had forecast net profit of 13.31 billion
rupees on sales of 52.58 billion. Most of Reliance's users are on CDMA
platform and Reliance is expanding the popular GSM-based services to
all 23 service areas from the current 8 circles.
Ambani said in January the company would spend about $6 billion in the
year to March 2009 as it expands its GSM network and builds mobile
phone towers, on the top of a $5.3 billion investment in fiscal 2008.
For the full year ended March, profit rose 70.8 percent to 54.01
billion rupees on revenue of 190.68 billion, the company said. Bharti
Airtel last week reported a forecast-beating 37 percent rise in
quarterly net profit to 18.53 billion rupees. Bharti had almost 62
million mobile users at end-March, a third more than Reliance's.
Shares in Reliance Communications were up 2.1 percent at 586.60 rupees
by 0751 GMT in a Mumbai market that was down 0.1 percent. Bharti was
up 1 percent at 910.70 rupees. Reliance Communications shares lost 32
percent between January and March, underperforming the main index that
fell 23 percent.
N.Sukumar
Research Analyst
beat forecasts with a 47 percent jump in quarterly net profit as it
added more users in the world's fastest-growing wireless market,
sending its shares up 2 percent.
India overtook the United States as the biggest market for wireless
services after China, with a record 10.2 million people signing up for
mobile phones in March.
Local call tariff of as low as U.S. 1 cent a minute and availability
of cheaper handsets has seen India's mobile phone users soaring 25
times between 2002 and 2007.
Yet, only 22 percent of India's more than a billion people own mobile
phones and operators have started expanding to smaller towns and to
rural areas where 70 percent of the people live. Reliance
Communications, part of the Anil Dhirubhai Ambani Group, added 4.8
million mobile users between January and March taking its total to
45.8 million subscribers.
The company, which lags leader Bharti Airtel said on Wednesday net
profit rose to 15.03 billion rupees ($372 million) in the fiscal
fourth quarter ended March 31 from 10.24 billion reported a year
earlier. "We are confident of improved performance in the future,"
Chairman Anil Ambani said in a statement. Earnings before interest,
tax, depreciation and amortization (EBITDA), a key performance gauge,
rose 41.7 percent to 23.16 billion rupees, while EBITDA margins rose
to 43.6 percent from 41.5 percent in the year-ago quarter. Revenue
rose to 53.11 billion rupees from 39.37 billion.
A Reuters poll of 10 analysts had forecast net profit of 13.31 billion
rupees on sales of 52.58 billion. Most of Reliance's users are on CDMA
platform and Reliance is expanding the popular GSM-based services to
all 23 service areas from the current 8 circles.
Ambani said in January the company would spend about $6 billion in the
year to March 2009 as it expands its GSM network and builds mobile
phone towers, on the top of a $5.3 billion investment in fiscal 2008.
For the full year ended March, profit rose 70.8 percent to 54.01
billion rupees on revenue of 190.68 billion, the company said. Bharti
Airtel last week reported a forecast-beating 37 percent rise in
quarterly net profit to 18.53 billion rupees. Bharti had almost 62
million mobile users at end-March, a third more than Reliance's.
Shares in Reliance Communications were up 2.1 percent at 586.60 rupees
by 0751 GMT in a Mumbai market that was down 0.1 percent. Bharti was
up 1 percent at 910.70 rupees. Reliance Communications shares lost 32
percent between January and March, underperforming the main index that
fell 23 percent.
N.Sukumar
Research Analyst
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