RCOM, part of the Reliance Anil Dhirubhai Ambani group, has posted net profit of Rs 740 crore in the September quarter, compared to Rs 1,531 crore in the year-ago period. The forex loss of Rs 283 crore forced the company, which posted a marginal 1% rise in revenue to Rs 5,703 crore, to post a sharp decline in profit.
The results were worse than the expectation. A survey of ETIG and four brokerage houses estimated RCOM’s net sales at Rs 6,356 crore and net profit at Rs 1,171 crore. However, the company would have posted a net profit of Rs 1023 crore, had there been no forex loss.
Bharti Airtel, the nation’s largest, on Friday posted a 13% rise in net profit and 9% revenue growth.
RCOM chairman Anil Ambani said: “ In the near term, the wireless sector in India is undergoing a challenging phase, with increased competitive intensity and continuing aggressive rebalancing of mobile tariffs by all leading players.”
The wireless revenues, main money spinner for the telco, dropped 7.5% to Rs 4010 crore while EBIDTA margin fell 540 basis points to 35.4%. In a statement, the company said higher competitive intensity, aggressive tariff restructuring by the telecom operators and higher network and operational costs owing to a nationwide GSM rollout have impacted wireless segment and EBIDTA margin.