Costs, shrinking ARPU hit Bharti net

Dylan Bushell-Embling
11 Nov 2010
00:00
News
Daily News

India's Bharti Airtel said its profit for the September quarter fell 27%, on soaring expansion costs and price pressures at home.

The company reported net profit of 16.6 billion rupees (€271.3m).

Revenue grew 47.9% during the first full quarter of operations under the Bharti umbrella for the African assets acquired from Zain. These units contributed $866 million (€628m) to revenue during the quarter.

But operating expenses grew by 75%, mostly due to costs related to expansion, Bharti said. Capital expenditure was 33 billion rupees, and 3.7 billion of this was also spent in Africa.

Earnings were also impacted by a decline in Asian ARPU to 202 rupees per month, from 215 rupees a quarter earlier, from intense price competition in the domestic market.

ARPU from Bharti's African operations was the equivalent of $7.50 per month, compared to $4.50 in India and south Asia.

The company added 52.2 million mobile customers in India, or 2% - the slowest rate of subscriber growth among India's six major cellcos. Bharti's market share in India was an estimated 20.8% at the end of the quarter.

Its African units added a combined 3.7 million customers, to bring the total to 40 million.

Bharti in February agreed to buy the African units of Kuwait's Zain Telecom in 16 African nations for $10.7 billion.

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