Idea Cellular reported standalone revenue of Rs. 6095.1 crore, up YoY from Rs 5403.5 crore for Q4 FY13. More here.
Highlights from Idea Cellular’s quarterly conference call for the quarter ended March 31, 2013:
On carrier competition: Idea noted that the competitive landscape is becoming clearer with five pan India GSM operators and 3 to 4 regional operators, down from 12 to 16 operators in each service area in 2009. It also noted that despite the recent auction held in March 2013, India did not attract any new large telecom companies.
Unavailability of spectrum: Idea noted that as per its calculations, the Indian government has a minimum of 286.1 MHz of 1800 MHz spectrum which it received after Supreme Court cancelled licenses. Govt also received an additional block return by the defense forces, 85 MHz of 800 MHz spectrum, 200 to 250 MHz of 2100 MHz spectrum with an average 2 to 3 slots available for 3G spectrum in each circle. It also speculates that 600 to 900 MHz of Spectrum will become available in 700 MHz when regulators finalizes the channel design for 4G spectrum. However, it points out that inspite of large spectrum bands available to the government, it’s unlikely to reach operators hands due to the gap in ability of operators to pay high price for carrier.
Tax cases: The company informed that it received two separate tax assessments orders, which it thinks are unjustified. The Income Tax department had slapped Rs 3900 crore notice on Idea Cellular and its subsidiary, Aditya Birla Telecom, over transfer of assets and licences between the two companies in 2009. The company claims that it has challenged these tax demands and awaits the final outcome.
License Transfer: Idea notes that it is awaiting DoT’s decision on transfer of Spice’s operating license of Punjab and Karnataka circles to Idea. Idea Cellular has paid Rs. 322 crores in 2010 as a part of 3G global auction bid winning price.
Improved network: It increased its presence in key metros with expansion of 2,400 km of backhaul transmission cables, overall reaching 74,000 km of fibre. The NLD business vertical has grown by 24.1% by traffic on a YoY basis in FY 13, with accumulated NLD traffic of 46.19 billion minutes. ILD business traffic has doubled in FY 13 to 4.27 billion minutes, a business Idea entered only in 2009-10. The company also expanded 2.5 time of its ISP capacity in the last four quarters and claims to handle over 24.5 gigabits per second data volume.
VAS: Idea informed that due to stiff VAS regulation by TRAI, non-data VAS as a percentage of service revenue declined to 8.6% in this quarter from 10.2% in Q2 FY13.
MNP: The company had an overall net gain of 6.7 million customers from other existing telecom operators.
3G data & products: In the recent, quarter the company launched three new Idea branded 3G smart phones – Zeal for Rs 5,300, Aurus-2 Rs 6,490 and Whiz for Rs 7,990. 3G device penetration on Idea network by March 2013 increased to 8% of its 121 million EoP base. The network claims to have 5.1 million active 3G base by the end of Q4 2013. Data ARPU for active 3G subscribers has increased to Rs 105 against Rs 97 in Q3 FY13. Data usage per 3G active subscriber declined at 608MB per subscriber from 628 MB in Q3 FY13. Idea added 1595 3G sites during the quarter and rolled out a total 17,140 3G sites in 10 of the service areas.
- The average realized rate per minute was flat at 41.2 paisa against 41.1 paisa per minute, an improvement of 0.3% compared to Q3 FY 13.
- Average Revenue Per User (ARPU) was at Rs 167, which it claims that has been improved by Rs 19 per subscriber over the last two quarters.
- It noted that the company is facing the impact of stricter acquisition process and reduced channel commission. For Q4 2013, the blended churn has dropped down to 4.3%, an improvement of 5.8% from a peak level of 10.1% in Q2 FY 13, with a saving of loss of over 6.7 million subscribers in six months.
- MoU per subscriber was at 406 minutes, an improvement of 47 minutes from 359 minutes in Q2 FY13. The total number of minutes on network increased to 143.366 billion, up from 132.181 billion, and 125.6 billion in the previous quarter.
- The daily data volume for Idea increased from 78.8 million megabytes per day, in Q1 FY13 to 126 million megabytes in this quarter, an growth of 61% within the four quarters.
- This quarter, the blended ARMB from EDGE users on GSM platform and HSPA users on 3G platform for Idea improved by 9.5%. The ARMB in Q4 FY13 stands at 33.9 paisa per MB, an improvement of 2.9 paisa per MB from 31 paisa in Q3 FY13.
Transcript of the call (pdf)