Idea Cellular Q1 Net falls by 12 per cent on 3G expenses

MUMBAI: Telecom services provider Idea Cellular on Friday said its net profit declined by 12 per cent to Rs 177.26 crore in the April-June quarter due to 3G spectrum fee payment and related interest costs.

"With the introduction of 3G services in the quarter, additional expenses of amortisation of 3G spectrum fee (Rs 65.6 crore) and charging of related interest cost (Rs 122.8 crore) has impacted the profits," Idea Cellular Managing Director Himanshu Kapania told reporters here.

The telecom firm had reported a profit of Rs 201.4 crore in the corresponding quarter of last year.

Total revenue of the company was up 23 per cent at Rs 4,520.20 crore for the quarter ended June 30, compared to Rs 3,653.7 crore in the same quarter last fiscal.

Idea is expanding its 3G footprint and currently covers 825 towns in 15 service areas, including bilateral roaming arrangement for the service areas in Mumbai, Bihar, Karnataka, Delhi, Kolkata and Tamil Nadu, with leading operators.

"We are making significant investment for 3G and we aim to reach 3,000 towns across the country and cover 50 per cent of our subscriber base," Kapania said.

The capex of the company is Rs 4,000 crore, of which Rs 1,000 crore has already been spent in this quarter, he said.

The net debt of the company is Rs 10,300 crore, which is forcast to go up slightly to Rs 11,000 crore by the end of this fiscal, he said.

The subscriber base of Idea is 95 million.