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Idea Cellular Q3-FY13: Made Rs 52 Per Data Sub, Rs 0.30 Per Data MB; VAS Down

In its earning report for the quarter ended December 30th 2012, Idea Cellular has pointed towards “regulatory interventions impacting ‘Subscriber Acquisition’ & ‘Value Added Services’ business model”, saying that despite these challenges, the company has reported a sequential quarterly revenue growth of 5%.

During the quarter, VAS declined as a percentage of revenue to 8.9%, from 10.2% last quarter, while data usage grew to 5.7% of service revenue from 5.4% last quarter. The company has reported a data subscriber base of 21.57 million, up quarter on quarter from 18.9 million, with data volume increasing to 9575 TB, average revenue per data MB to Rs 0.305, and Rs 52 per data subscriber. Average revenue per MB declined quarter on quarter Rs 0.317, while Data ARPU went up from Rs 50. The 3G base was 4.1 million customers.

Idea Cellular advertising at the Kumbh Mela. (c) 2013 Nikhil Pahwa

Financial Results

The company reported standalone revenue of Rs. 5,613.5 crore, up 10.8% on YoY from Rs. 5065.2 crore. This was largely due to Voice Minutes up 5.2% to 132.2 billion minutes from to 125.6 billion minutes in Q2FY13, during what as the festive season.  The standalone EBITDA was at Rs 1317.3 crore compared to Rs 1261.5 crore in the previous quarter. The EBITDA margin is marginally lower at 23.5% on account of higher inflationary burden in ‘Network operating expense’ led by full quarter impact of increased diesel price & larger outlay for ‘Advertising & Business Promotion’ expense.

The PAT was at Rs 191 crore, and Cash Profit was Rs 1108.5 million for the quarter were lower compared to previous quarter primarily due to dividend payment received from Indus in Q2FY13.

In the recently concluded 1800MHz November 2012 spectrum auction, company won back spectrum in all 7 service areas for which licenses were quashed by the Supreme Court, at a bid amount of Rs. 19,848 million for a period of 20 years. This would have impacted over 8 million Idea customers, had Idea not got the spectrum.

Operational Parameters

– Contrary to expectation, the ‘Average Realised Rate per Minute’ (ARPM) fell this quarter to Rs. 0.411 against Rs 0.413 per minute in Q2FY13. The challenge on ARPM, the company said, is on account of fall in the ‘Non-Voice Revenue’ contribution to 14.6%, driven down 1% over the last quarter, by TRAI’s new VAS regulation.
– Average minutes of use: 384, up from 359 last quarter.
– Average Realization per minute (ARPM): down to Rs 0.411 from Rs 0.413 last quarter.
– MNP: claims a net gain of 5.5 million customers (as on January 18th 2013) from other existing operators.
– Minutes of Use: The total number of minutes on network increased to 132.181 billion from 125.6 billion last quarter.
– Connection base: decreased to 113.9 million, the second consecutive quarter of declining connection base.
– Idea’s Active Connection base went up by 2.9 million, up significantly quarter on quarter from 0.6 million
– Prepaid subscribers: 96.1% of total subscriber base, down from 96.2%
– Cell sites: Added 2,961 new sites (2G+3G), expanded optical fibre network to 71,600 km and strengthened network capacities in NLD, ILD, ISP, Data Services and Devices. 15,545 3G sites, up from 14,467 QoQ. Total 87,662 2G cell sites, up quarter on quarter from 85,779.
– Churn: 6.9% blended churn, with prepaid churn at 7% and postpaid churn at 3.2%
Cost of acquiring a customer also increased to meet the new guidelines on subscriber verification
Customer churn was lower at 6.9% and reduced gross additions.
– Data Customers: Out of the existing 114 million subscriber base, the number of Idea customers adopting data services has exponentially grown to 21.75 million, now contributing 5.7% to Service Revenue.
– The Data volume grew by 14.8% to 9,575 TB in Q3FY13 (8,339 TB in Q2FY13), while data revenue on sequential quarter basis grew by 10.8%.
– The active 3G subscriber base for the company now stands at 4.1 million.

Note: we’ll update with a data sheet

DownloadsMedia Release |  Quarterly ReportUnaudited Results

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