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Last Updated Tuesday May 22 2018 05:26 AM IST

Reliance Jio records Rs 500 crore profit, Airtel dips

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Jio Reliance jio recorded first ever profit of Rs 503 crore: File photo

New Delhi: Telecom major Bharti Airtel said the mobile tariff in the country is at unsustainable levels, but the battle in the industry at present is focused on market share, which continue to put pressure on business.

"I would say pricing today is at deeply compressed levels which is why we have seen the kind of consolidation that has happened in the last 12 months. This level of pricing are clearly unsustainable.

Pricing (rates) will have to lift but, at this point of time there is a fight for market share and that's being driven by the new entrant and therefore pricing remains compressed," Gopal Vittal, MD and CEO, India & South Asia, said during an earnings call.

India's largest telecom operator Bharti Airtel posted a decline in consolidated net profit for the seventh straight quarter to Rs 305.8 crore for the three month period ended December 31, 2017 on account of tariff war in the industry.

Sunil Bharti Mittal led telecom firm had registered a net profit of Rs 503.6 crore in the same period a year ago.

On the other hand, the new entrant Reliance Jio, which led to tariff war, today posted it's first ever profit at Rs 504 crore.

Vittal said that customers may be willing to pay Rs 400- 500 but they can get the unlimited call and data for Rs 130 a month.

"We have revenue sitting above this level. This has resulted in ARPU (average revenue per user) erosion. If you look back over the last 3-4 quarter, the kind of ARPU erosion you have seen, we are unlikely to see that kind of ARPU erosion going forward," he said.

The average revenue per user of Bharti Airtel in India declined by 28.6 per cent to Rs 123 in the quarter from Rs 172 in the year-ago period.

Vittal said that Indian telecom market will soon be a three player market apart from state-run BSNL.

The company is in process of merging mobile business of Tata Teleservices (TTSL) and Telenor.

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The opinions expressed here do not reflect those of Malayala Manorama. Legal action under the IT Act will be taken against those making derogatory and obscene statements.

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