Reliance Communications reports net loss of Rs 1,051 crore in 2010-11

Communications (RCOM) reported a marginal rise of 4.4 percent in its overall
revenues at Rs 23,108 crore ($5,071 million), as against Rs 22,132 crore in the
last financial year.


the telco saw an 86 percent fall in net profits at Rs 168.6 crore for the January-March quarter compared to
Rs 1,219.5 crore in the same period last year. The company’s year-on-year net
profit also saw a decline of Rs 3,271.62 crore at Rs 1,505.82 crore in FY’11,
down from Rs 4,777.44 crore in FY’10. EBITDA was reported at Rs. 9,081 crore
($1,993 million), up 16.1 percent as against Rs. 7,821 crore ($1,665 million)
in FY’10.


fall in profits is attributed to RCOM’s wireless ARPU which also registered a
decline at Rs 107, as against Rs 139 in the same quarter in the last fiscal, as
well as 3G payments and fluctuating market cues. At present, RCom has drawn $1.33 billion towards refinancing of 3G spectrum, out of the $1.93 billion
underwritten facility it possess from China Development Bank.


the operator plans to focus more on profitable data and VAS services, and has
registered a 33 percent increase in customer base at 136 million, as against
102 million in the corresponding period last year.

global business division also posted a 196.3 percent q-o-q growth in net
revenues at Rs 3,832.3 crore from Rs 1,293.2 crore last year. This year, the
global business division contributed 46 percent to the total revenues, as
compared to 28 percent last year.


broadband revenues also saw a q-o-q net increase of 12.8 percent. However,
broadband contribution to the company’s overall revenues witnessed a decline of
7 percent, as compared to 9 percent last fiscal. RCom’s total NLD minutes for
the quarter ended March 2011 saw a marginal increase to 16,578 from 16,569 last
fiscal, while its total ILD minutes saw a marginal increase to 4,538 from 4,084
last year.


RCom was the biggest loser in MNP among the private players, having to bid goodbye to almost 350,000
subscribers, it has gained with 3G offering
services in over 850 cities across India and contributed approximately one
million to the total of nine million 3G subscribers in India, thus far.


a media note released, RCom revealed that it has received offers for the
acquisition of RCOM’s controlling interest in Reliance Infratel,
its passive infrastructure subsidiary. This is important for the telco, as
earlier attempts to attract controlling stakes in its tower business with GTL
and Etisalat DB were called off, leaving RCom in dire need of a new investor,
to reduce the latter’s overall debt.


Beryl M

[email protected]