During Q1-11, the quarter ended 30th June 2010, MTNL, the government owned telecom operator which services only Delhi and Mumbai, added 41,144 broadband connections, and it’s a reflection of the sorry state of broadband in India that with just 856,974 subscribers broadband customers, MTNL is the second largest broadband service provider in the country. Government MTNL and BSNL own a majority of the telephone connections to home in Delhi and Mumbai, and most other wireline service providers haven’t got distribution to match theirs. India hasn’t opened up its last mile access, and this scarcity has contributed to higher returns for the government from the BWA auctions. During the quarter, MTNL added 117,927 GSM connections, with a total of 4.9 million connections by the end of the quarter.

Financial Results

MTNLs Cellular segment revenue declined year on year to Rs. 1,659.17 million for the quarter, as compared to Rs. 1,754.63 for the corresponding quarter last year. The cellular business reported an EBITDA profit of Rs. 69.97 million, down from Rs. 179.43 million for Q110.

The net loss for Q1-11 this quarter for MTNL was Rs. 4514.35 Million, as against Rs. 423.06 Million in the corresponding quarter last year, more than 10 times. The reason for this is being attributed to staff cost, provision for retirement benefits and payment of spectrum on amortization of one time charges of 3G & BWA spectrum to the extent of Rs. 1576.15 million during the quarter. Staff costs for retirement benefit went up to Rs. 2,785.67 Million from Rs. 1,674.77 Million as in the same quarter last year.

Income increased to Rs. 9,716.26 million for Q1-11, from Rs. 9,525.87 million during the corresponding quarter of previous year.

Download: Release | Financials