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Idea Cellular Q3-FY11 ARPU At Rs 168; Profit Up To Rs 243 Crore

Idea Cellular has had a good quarter. It has reported a small increase in its Average Revenue Per User (ARPU). For the quarter ended December 31st 2010, Idea Cellular reported a 0.59 % increase in its ARPU, which increased to Rs.168 , from Rs. 167 at the end of the previous sequential quarter. Sequentially, Consolidated Profit increased significantly to Rs. 243 crore from Rs 179.7 crore. Gross revenue increased by 8.1% quarter on quarter, to Rs 3955.6 crore from Rs3659.2 crore. The contribution of mobile Value Added Services (including P2P SMS) to Idea Cellular has marginally increased to 13% of service revenue, from 12.9% last quarter, and from 11.2%  last year.

– Subscriber base:  81.8 million, up from 74.2 million Q2-11

– Prepaid subscribers: 96.3% of total, up from 96.1% from Q2-11
– Average Revenue Per User (ARPU): Rs.168 , up from Rs. 167 at the end of Q2-11
– Average Minutes of Use per user (MoU): 401, up from 394 last quarter

– Total Minutes of Use:  93.5 billion, up from 84.8 billion
– Average Realized Rate per minute (ARR): Rs.0.418  down from Rs. 0.42
– Average cost per minute: Rs. 33.9

– Cell sites: rolled out 2,228 cell sites, taking EoP cell sites to 70,208

The Average Realised Rate per minute declined marginally to 41.8p, compared to 42.3p in the previous quarter. Idea grew its total Minutes on Network by 10.2%, while Standalone Revenue expanded by
8.2%, on a sequential quarterly basis. The Average Realised Rate per minute declined marginally to 41.8p, compared to 42.3p in the previous quarter.

The increase in Advertising and in Subscriber Acquisition & Servicing costs by ~2.5% (as a percentage of revenue), were substantially cushioned by volume led cost efficiencies, resulting in almost flat EBITDA margins. Simultaneously, there has been an increase in the average minutes of use per user to 401 from 394 last quarter, even though total minutes of use grew by 10.2%.

The Net Debt as of December 31st, 2010 stands at Rs. 92,924 million and the Net Debt-Equity ratio is 0.77.

Note that financials may not be comparable year on year, due to the amalgamation of Spice Communications into Idea Cellular from March 2010 onwards.

Still No 3G Rollout

During the quarter, according to Idea Cellular, interest of Rs. 1,242 mn was capitalised against the payment for 3G auction fee. According to the company’s quarterly report, preparatory work for 3G rollout is on track, and Idea will, in the next few months, launch 3G services in the 11 service areas where it won the 3G spectrum. In the meantime, Tata Docomo, Reliance Communications and Bharti Airtel have launched 3G services in select circles. What’s holding Idea back?

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