Bharti Airtel has reported sharply higher losses for the June quarter as it made additional provisions towards the adjusted gross revenue (AGR) dues. The country’s second largest telco has posted a consolidated loss of Rs 15,933 crore compared with a net loss of Rs 5,237 crore in the March quarter and Rs 2,866 crore in the corresponding previous quarter.
Brokerages had expected the telco to report net losses of up to Rs 2,000 crore. The Supreme Court on June 18 observed that the amount of AGR dues assessed by the DoT is to be treated as final. Bharti Airtel added that it has, therefore, recorded an incremental provision of Rs 10,744 crore.
The company further disclosed that during the quarter, it re-assessed the carrying amounts of its deferred tax balances. Here, Bharti Airtel opted for the ‘Vivad se Vishwas Scheme 2020’, the income tax amnesty scheme to settle tax related disputes. Bharti Airtel decided to settle its disputes for assessment years 2010-11 to assessment years 2016-17. While its application was approved by the tax authorities, it showed a tax expense of Rs 6,713 crore.
Despite the higher loss, there was some good news with the company disclosing a higher average revenue per user (ARPU), which rose to Rs 157 from Rs 129 a year ago.
The full impact of its tariff hikes in the previous quarter along with its focus on quality customers contributed to this.
Consolidated revenues at Rs 23,939 crore grew 15.4 per cent over the year-ago period even as consolidated mobile data traffic at 7,019 petbytes in the quarter registered a healthy growth of 73.5 per cent.
Standalone revenues grew to Rs 15,049 crore from Rs 12,833 crore a year ago. However, the losses here were at Rs 16,462 crore compared with a loss of Rs 1,304 crore last fiscal.
“We are going through an unprecedented crisis caused by Covid...Data traffic growth surged by around 73 per cent year on year even as 4G net additions slowed down to two million caused by supply chain shocks in the device eco system,’’ Gopal Vittal, MD and CEO, India & South Asia, said.
ICICI Lombard
ICICI Lombard General Insurance has initiated talks to acquire Bharti Enterprises-backed Bharti AXA General Insurance in an all-stock transaction, according to sources.
Bharti Enterprises now owns 51 per cent in Bharti AXA General Insurance, while French insurer AXA has 49 per cent. According to sources, the valuation of Bharti-AXA has been pegged around Rs 2,800 crore.
Ahead of the results, its shares ended marginally in the green at Rs 566.35. This came amid reports that the ICICI Lombard is likely to acquire Bharti Axa for a valuation of around Rs 3000 crore.