Profit falls for 11 quarters at Temasek-backed Indian

[makapaaa]

[h=2]Profit falls for 11 quarters at Temasek-backed Indian
Telco[/h]

November 9th, 2012 |

Author: Online Press




Singapore’s sovereign wealth fund Temasek-backed Bharti Airtel
reported its 11th consecutive quarter of profit decline with margins pressured
by intense competition.

Top Indian telecommunications carrier Bharti Airtel Ltd
will struggle to improve its profits in the coming quarters amid an uncertain
regulatory environment in its home market after the company reported its 11th
consecutive quarter of profit decline with margins pressured by intense
competition.

Bharti, controlled by billionaire Sunil Mittal, on Wednesday reported its
consolidated net profit fell 30 per cent from a year earlier to 7.21 billion
rupees for the three months to September, despite a one-off gain of 2.39 billion
rupees from an outstanding dispute over inter-connect charges.

Competition is seen abating in the world’s second-biggest mobile phone market
after a court order revoked the permits of several smaller carriers, which is a
positive for market leaders Bharti and the local unit of Vodafone Group Plc.

India’s leading carriers, however, face the risk of paying out billions of
dollars in regulatory fees over the next few years with the government planning
to impose a surcharge on airwaves held by them and also due to reallocation, or
switching, of their superior quality spectrum when their permits are
renewed.

“The worry remains regulation,” said Vivekanand Subbaraman, a
telecommunications analyst at PhillipCapital India. “The regulatory concerns
have overshadowed operating performance,” he said, adding Bharti could continue
to see its margins eroding.

India is planning to levy more than $5.5 billion in surcharges on airwaves
held by older telecommunications companies, from which Bharti’s payout is
estimated to be just under $1 billion.

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Rest of the article from: http://www.vccircle.com/news/2012/11/07/bharti-airtels-profit-falls-11th-straight-quarter

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[scroobal]

Remember guys, its a long term strategic investment.

 

[Char_Azn]

1)Profit margin falling not equal to loss making especially since this has more to do with huge levies than increase competition or lousy management. Most pple involved with India would have seen this coming.
2)If anyone has dealt with Airtel in India, U won't be too overly worried about them going into the red anytime soon. Between them and the rest of the major players like BSNL, U probably have very little choice if U want something reliable.

 

[johnny333]

1)Profit margin falling not equal to loss making especially since this has more to do with huge levies than increase competition or lousy management. Most pple involved with India would have seen this coming.
2)If anyone has dealt with Airtel in India, U won't be too overly worried about them going into the red anytime soon. Between them and the rest of the major players like BSNL, U probably have very little choice if U want something reliable.

I wonder how much $$$ is being lost due to corruption It is well known than corruption exists in India.

PAP can't be blamed for their ignorance about corruption because we have "very little" corruption

 

[Char_Azn]

I wonder how much $$$ is being lost due to corruption It is well known than corruption exists in India.

I won't be surprise if up to 50% of the cost goes to paying off someone for a particular project. Heard stories from a number of my colleagues. That's the problem with SG doing biz with other countries, we are used to dealing with under the table kopi money. The problem is if you don't pay you don't get the work.

I've heard of many ridiculous tales during my time in India. My personal fav was a news report on a forestry minister in a particular state who was in charge of protecting a national park. Instead he opened a logging company inside the park to cut down the very trees he was supposed to protect. When a reporter/activist tried to exposed him, he was murdered. Police stepped in to investigate the case and the guy run road for a few weeks. He then came back and surrendered to the police. Last I heard he was still a free man and the logging company is still running. Incredible India