Reliance Communications rallies over 4% on five-fold jump in Q2 net profit

NEW DELHI: Reliance Communications Ltd rallied as much as 4.06 per cent in early trade on Wednesday after the Anil Ambani-led Group company reported a five-fold jump in its second quarter net profit owning to a writeback from an earlier provision.

The mobile operator reported a net profit of Rs 675 crore for the July-September period, including a Rs 441 crore writeback for restructuring provisions the company had made earlier under court order.

At 09:50 a.m.; Reliance Communications was trading 3.3 per cent higher at Rs 133.50. It has hit a low of Rs 131.90 and a high of Rs 134.40 in trade today.

However, the profit without the writeback was still higher than the same period a year ago by 130 per cent, making the first profit rise in five quarters.

The company reported a 7 per cent increase in revenues at Rs 5361 crore, with its biggest operating leverage coming from a Rs 120 crore drop in employee costs, ET reported.

For the last three years, the company has been bogged down by high interest costs as it is one of the highest leverage Indian teleocm companies.