The new telecom player posted a net profit of Rs 831 cr for three months ended December 2018 as compared to Rs 504 cr in the corresponding quarter a year ago
Increased in subscriber base coupled with a surge in data usage helped Reliance Jio Infocomm post a 65% jump in net profit for the third quarter of this financial year (FY).
The new telecom player posted a net profit of Rs 831 crore for three months ended December 2018 as compared to Rs 504 crore in the corresponding quarter a year ago, the company said on Thursday.
Operating revenues grew 50.9% to Rs 10,383 crore year on year. The subscriber base at end of December end stood at 280.1 million (28 crore), with average revenue per user (Arpu) at Rs 130, which has been declining for the past few quarters. Data usage was 10.8 GB per user per month, while voice consumption per subscriber was 794 minutes per month.
The total wireless data traffic during the quarter stood at 864 crore GB, while total voice traffic during the quarter stood at of 63,406 crore minutes.
Video consumption drove most of the usage, increasing to 460 crore hours per month, the company said.
Jio said it is on track to expand its all-IP 4G LTE network coverage to 99% of the population and it is expected to be completed in the next few months.
The firm's new offering JioGigaFiber has reached 1,400 cities and Jio is currently connecting homes on priority based on the requests received and optimising its service offerings.
In an analyst note, research firm Jefferies said, "We expect the competitive intensity to remain high as operators vie for market share. We expect Arpu to remain under pressure and cost pressures to also increase. Additionally, recovery post equilibrium (post-mid-FY20) to be gradual. Arpu increases would require investment in both capacity and content"
The entry of Reliance Jio in the sector had triggered a consolidation in the sector apart from pushing the financials of the incumbents on a downward trajectory. But consumers benefited the most with free voice calls and dirt-cheap data tariffs.
To strengthen its broadband and fibre play, Reliance Industries Ltd (RIL), the group company, is awaiting regulatory approvals to complete the recently announced investments in Den Networks Ltd and Hathway Cable and Datacom Ltd. Post completion of the transactions, Reliance and Jio will be strengthening the business model of 27,000 LCOs (local cable operators) that are aligned with DEN and Hathway across 750 cities, by creating multiple future opportunities with new services and platforms.
During the quarter, the company extended the term of the definitive agreement for the acquisition of specified assets of Reliance Communications to June 28, 2019.
Mukesh D Ambani, chairman and managing director, Reliance Industries Ltd, said, "The journey of Jio has been truly remarkable and has surpassed all expectations. The Jio family is now 280-million strong and growing on one of the world's largest mobile data networks, in line with our vision of connecting everyone and everything, everywhere – always at the highest quality and the most affordable price. We are similarly working on reinventing the connectivity solutions market for Homes and Enterprise with our next generation FTTX (fibre to the x or fibre in the loop) services."
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