Bharti Airtel logs Q2 net profit at Rs 1,134 cr

India's second-largest telecom firm Bharti Airtel on Tuesday reported a net profit of Rs 1,134 crore for the September 2021 quarter, and said it is witnessing strong business momentum with growth in 4G customers and increase in mobile ARPU.

This is against a loss (attributable to owners of the parent) of 763.2 crore during the year-ago quarter, the company said in a statement.

Its consolidated revenues for the second quarter of FY21 stood at Rs 28,326.4 crore, up 18.8 per cent year-on-year (on a comparable basis) and 13 per cent y-o-y on a reported basis, it added.

"The term 'comparable' refers to the impact of mobile termination charges in mobile – India business which have been reduced to Rs 0.00 per MoU from INR 0.06 per MoU, effective January 1, 2021, as per TRAI guidelines," it said.

Airtel's customer base stands at about 480 million across 16 countries. Its total capex spend for the September quarter stood at Rs 6,972 crore.

Bharti Airtel MD and CEO (India and South Asia) Gopal Vittal welcomed the reforms announced by the government for the telecom industry, and said this will add to the ability of the industry to invest so as to drive India's digital story.

"We hope the reforms momentum will continue and all longstanding issues impacting the industry will be addressed," he added.

Bharti Airtel has opted for a four-year payments moratorium -- on AGR (adjusted gross revenue) and spectrum dues -- being offered by the government as part of a relief package for the telecom sector.

In line with the bold reforms unveiled for the telecom sector, the government had written to telcos, including Bharti Airtel, Vodafone Idea and Reliance Jio, asking them to convey by October 29 if they would be opting for the four-year dues moratorium.

Telcos have also been given 90 days to indicate if they want to opt for converting the interest amount pertaining to the moratorium period, into equity.

Vittal stated that the company continues to maintain high degree of financial flexibility.

"As a result, we have now achieved nil bank debt for our India businesses.

"We will continue to evaluate all options to maintain comfortable leverage profile and manage associated costs.

"During the quarter gone by, we sustained our operational excellence with a healthy 5.5 per cent sequential growth in consolidated revenues and expansion of EBITDA (earnings before interest, tax, depreciation and amortisation) margin to 49.5 per cent," he added.

The company's strategy of focusing on quality customers has been validated by the strong price flow and ARPU (avergae revenue per user) increase that it has seen in its wireless business, he noted.

"The step-up in performance of our enterprise and homes business reflects the resilience and strength of our overall portfolio.

"Even more exciting is the way our new businesses – Airtel Payments Bank, data centres and revenues from digital services – are shaping up. With a future proofed 5G network, we are well positioned to build a strong Airtel of the future," Vittal said.

Post the quarter close, Airtel completed application money leg of the rights issue of up to Rs 20,987 crore with a subscription of about 1.44 times, overbid by both public and promoter/promoter group, the statement said.

Airtel's India revenues for the second quarter of FY22 stood at Rs 19,890 crore, up 18.3 per cent y-o-y on a comparable basis and 10.4 per cent y-o-y on a reported basis.

Its customer base stood at about 355 million.

Mobile revenues grew 20.3 per cent y-o-y on a comparable basis on account of increase in ARPU and strong 4G customer addition.

ARPU for the quarter came in at Rs 153 as compared to Rs 143 in September 2021 quarter on a comparable basis.

The company said it continues to gain a strong share of the 4G customers in the market.

4G data customers increased by 26.1 per cent y-o-y to 192.5 million.

Airtel said that in the past four quarters, it has added 39.9 million 4G customers to its network.

The average data usage per data customer stood at 18.6 GB per month and voice usage per customer at 1,053 minutes a month.

To optimally augment its coverage, the company rolled out additional 3,500 towers and about 56,000 mobile broadband base stations in the quarter.

"Several initiatives have also been undertaken to improve network quality – leveraging digital tools/probes to monitor and improve customer experience and scaling up Vo-Wi-Fi adoption to improve indoor experience.

"We now have over 33 million customers using our Vo-Wi-Fi services," the statement said.

For the September quarter, Airtel business revenues rose by 11.5 per cent year-on-year, while the homes business demonstrated growth of 21.3 per cent y-o-y with highest-ever customer net additions of about 4.67 lakh during the quarter to reach to a total base of 3.8 million.

The digital TV business grew 5.7 per cent over the same period the previous year.

During the quarter, Airtel Payments Bank turned profitable with a strong total customer base of over 115 million and monthly transacting users (MTU) base of over 31 million, the statement said.

Bharti Airtel's shares closed at Rs 712.90 apiece on the BSE on Tuesday.

The results came in after the market hours.

Its Africa revenue (in constant currency) was up 22.7 per cent y-o-y with customer base at 122.7 million.

The Q2 numbers were bolstered by an exceptional gain (after tax) of Rs 540.4 crore.

Bharti Airtel in August announced the closure of an agreement with Reliance Jio Infocomm to transfer the 'Right to Use' of its 800-MHz spectrum in three circles to Jio.

"During the quarter ended September 30, 2021, net gain on account of transfer of spectrum right to another telecom operator of Rs 7,221 million (Rs 722.1 crore)... Tax charge due to above exceptional items of Rs 1,817 million (Rs 181.7 crore) is included under tax expense," the company said in its quarterly report.

Photograph: Sivaram V/Reuters