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Idea Cellular Q4-FY11: ARPU Down, VAS Down; Profit Up 13% To Rs 274 Crore

Idea Cellular has reported a decrease in the contribution of mobile Value Added Services (including P2P SMS) for the quarter ending 31st March 2010 – down marginally to 12.1% of service revenue from 12.4% last year, but more importantly, down from 13% reported last quarter. This is at a time when other telecom operators are reporting an increase in contribution from VAS.

The company has also reported a 4 % decrease in its ARPU at Rs 161, from Rs 168 that it had reported at the end of the previous sequential quarter. Sequentially, Consolidated Profit increased significantly to Rs 274.52 crore  from Rs 243 crore, while gross revenue increased by 7.06% quarter on quarter, to Rs 4234.7 crore  from Rs 3955.6 crore.

According to the company’s quarterly report, Idea has  rolled out its 3G services in the service areas of Maharashtra & Goa, Andhra Pradesh, Kerala, MP & Chhattisgarh, Gujarat, UP  (West) and Uttaranchal, UP  (East), Haryana & Himachal Pradesh.  Additionally, Idea plans to offer 3G services, across India, through a combination of home network and roaming arrangements, with select leading quality operators. The company says that an interest of Rs.124 crore has been capitalised during Q4 against the payment for 3G spectrum fees.

Operational statistics

– Subscriber base:  89.5 million, up from 81.8 million in Q3-FY11
– Prepaid subscribers: 96.4% of total, up from 96.3% from Q3-FY11
– Average Revenue Per User (ARPU): Rs.161, down from Rs. 168 at the end of Q3-FY11
– Average Minutes of Use per user (MoU): 397, down from 401 last quarter
– Total Minutes of Use:  101.96  billion, up from 93.5 billion in Q3-FY11
– Average Realized Rate per minute (ARR): Rs.0.406  down from Rs. 0.418
– Cell sites: EoP cell sites – 73,668
– Minutes on Network increased by 9%, while Standalone Revenue expanded by 7%, on a sequential quarterly basis.
– Idea added over 9.6 mn active subscribers during the quarter, taking the VLR subscriber base to 83.3 mn, with
the highest ratio of active subscribers to reported subscribers in the sector at 93.1%, as on 31st March 2011.

– Idea carried 362.6 billion minutes on its network in FY11. On a normalized annual basis, Idea minutes grew 46.5%,


Quarterly: During the quarter ended 31st March 2011, Idea Cellular reported total revenues of Rs 4234.72 crore, a sequential increase of 7.06% and a 26.49% hike compared to its revenues in the same quarter during the last financial year. The company’s Net profit went up by 12.97% QoQ and 2.97% YoY, at Rs 274.52 crore.

On a standalone basis, profit after tax for the quarter stands at Rs. 257.6 crore, up 16.6%, on a sequential quarterly
basis, while cash profit of Rs. 903.1 crore, grew by 17.7%. During the quarter, EBITDA on a standalone basis increased sequentially by 15.6%, driven by a 1.2% improvement of EBITDA margin in the Established Service Areas, coupled with reduced EBITDA losses of the New Service Areas by Rs 21.1 crore.

Annual: On an annual basis, Idea registered consolidated net revenues of Rs. 15503.2 crore in FY11 compared to Rs.12447 crore in FY10. Annual net profit declined to Rs 898.7 crore in FY11 from Rs 953.9 crore in the last financial year.

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

Downloads: Media Release | Financials | Quarterly Rerport

Spice-Idea Cellular Merger Case

The erstwhile Spice Communications was amalgamated with the Company effective March 1, 2010 pursuant to sanction of the Scheme of Amalgamation by the the Gujarat High Court and the Delhi High Court. However, on March 30, 2011, upon an application made by DoT, the Delhi High Court has stayed operation of its order dated February 5, 2010, sanctioning the Scheme of Amalgamation.

The Company had filed an application before the Delhi High Court seeking vacation of the said ex-parte stay, the hearing in respect of which has been concluded and the judgment is reserved. On June 2, 2011, Delhi High Court, on a further application filed by the Company seeking permission for adoption of accounts by the Board of Directors, permitted the Company to adopt accounts and complete all legal obligations in that behalf. The adoption of the accounts by the Board shall be subject to further orders to be passed by the Delhi High Court.

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