Jio continues to login profit, nets Rs 681 cr in Q2

MUMBAI: Country's most aggressive telco Reliance Jio Wednesday reported a post-tax profit of Rs 681 crore for the September quarter on a handsome increase in revenue and subscriber additions which crossed 252 million.

The company, an arm of largest private sector corporate Reliance Industries, had reported a loss of Rs 271 crore in the year-ago period and profit of Rs 612 crore in the preceding quarter.

Its operating revenue increased 13.9 per cent to Rs 9,240 crore, while the pre-tax profit stood at Rs 2,042 crore, up 19.6 per cent.

The company's operating margin came in at 38.7 per cent, which is a 0.12 per cent compression compared to the preceding quarter, the company said.

The average revenue per user or Arpu which is the key profitability metric in telecom business, declined marginally to Rs 131.7 from Rs 134.5 in the June quarter, which was attributed by the head of strategy, Anshuman Thakur, to a higher adoption of feature phones which is going for Rs 99 a month as an introductory offer now.

The company crossed 252 million subscribers, which makes it the third largest in the industry, and Thakur pointed out that this is the fastest in the world as it has been achieved within 25 months of commercial launch.

The company added a net of over 37 million subscribers during the reporting quarter itself, as against 28.7 million in the previous quarter, he said.

Thakur said the deals to acquire Reliance Communications' towers, spectrum and fibre businesses are stuck at various stages.

Stating that the group's consumer-facing businesses, which includes Reliance Retail and the telecom business Jio, are gathering momentum, group chairman Mukesh Ambani said the performance of both retail and Jio reflect the benefits of scale, technology and operational efficiencies.

"Retail business operating margins has grown three- fold on a year-on-year basis whereas Jio's margins has grown nearly 2.5 times. Jio has now crossed 250 million subscriber milestone and continues to be the largest mobile data carrier in the world," Ambani said.

RIL also said it will make a "primary investment of Rs 2,045 crore through a preferential issue under Sebi regulations and secondary purchase of Rs 245 crore from the existing promoters for a 66 per cent stake in Den Network".

Also, it will make a primary investment of Rs 2,940 crore through a preferential issue for a 51.34 per cent stake in Hathway Cables, taking the total play to Rs 5,340 crore into these two companies.

RIL would also make open offers to minority shareholders of Hathway, a company jointly controlled by Hathway with 37.3 per cent stake, and Hathway Bhawani Cabletel and Datacomm, a subsidiary of Hathway.