Airtel’s net profit plunges 75%, but beats estimates

NEWDELHI: Bharti Airtel Ltd’s fiscal-first quarter profit plunged 75%, the third straight quarterly decline, as new entrant Reliance Jio Infocomm Ltd, backed by India’s richest man, sparked a price war aimed at upending the mobile phone services market.

Bharti Airtel’s net profit declined to ₹367 cr ore in the three moths ended June 30 from ₹1,462 cr ore in the year earlier, the company said on Tuesday. That exceeded the ₹282 crore profit estimate of eight analysts surveyed by Bloomberg.

“Jio will continue to damage these guys,” said Dharmesh Shah, a Mumbai-based analyst tracking telecom sector, referring to the huge amounts telcos bid for radio waves.

Air te l’ s India revenue declined 10% to ₹17,244 cr or east he company offered discounts to customers to keep them from defecting to Reliance J io’ s network. The company attributed the decline in India revenue primarily to a 14.1%dropin mobile revenues. It blamed Jio for the stress on its financials. Still, the company signed up 5.2 million new customers in the June quarter, the highest ever quarterly addition.

Bharti Airtel’s operating margin from mobile services narrowed to 34.3% in the June quarter from 42.6% a year ago as revenues fell and costs rose.