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Airtel blames regulators for falling revenue, profit

19 Jan 2018

Indian mobile market leader Bharti Airtel has recorded a 13% year-on-year drop in total revenues to INR203.2 billion (USD3.18 billion) for the three months ended 31 December 2017, attributing the slump to the divestment of its Ghana subsidiary, as well as regulatory changes in its domestic market. Turnover from the operator’s Indian businesses dropped 15% y-o-y to INR152.9 billion, despite continuing customer additions – in particular data subscribers – and a 450% y-o-y increase in monthly data usage per customer, as monthly mobile ARPU fell to INR123 from INR145 in the previous quarter and INR172 in the year-ago period. Recent pressure on Airtel’s topline has largely been attributed to price erosion caused by new arrival Reliance Jio Infocomm following its entry into the Indian wireless sector in September 2016. Airtel’s MD and CEO for India and South Asia, Gopal Vittal, levelled the blame at Indian authorities, however, saying: ‘Regulatory fiat in the form of a cut in domestic IUC [interconnection usage charge] rates has exacerbated the industry ARPU decline in Q3 2018. The recent announcement of reduction in International termination rates will further accentuate this decline and benefit foreign operators with no commensurate benefit to customers.’

Consolidated EBITDA for the group, meanwhile, dropped 12% y-o-y to INR76 billion, with net income falling by 39% to INR3.1 billion from INR5.0 billion a year earlier. Despite such difficulties, however, the group counted a subscriber base of 394.2 million at end-December 2017 (an increase of 2.8% y-o-y), including 376.4 million wireless subscribers throughout India (290.1 million), South Asia (2.2 million) and its African subsidiaries (84.1 million).

India, Bharti Airtel

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