Bharti Airtel Ltd’s profit for the financial year ending March more than halved, weighed down by a continuing tariff war with Reliance Jio Infocomm Ltd in India which started almost three years ago.
Net profit for 2018-19 fell 62.7% year-on-year to ₹409.5 crore from ₹1,099 crore in financial year 2017-18. The results underscore the sustained struggle of Bharti Airtel and other telecom operators in India to grow profits despite recording higher data and voice consumption.
However, net profit for the March quarter rose 29% year on year to ₹107.2 crore from ₹82.9 crore in the same period last year.
Revenue from operations for the fourth quarter grew to ₹20,602.2 crore from ₹19,394 crore in the year ago period.
The launch of low-cost tariff plans by Reliance Jio, backed by India’s richest man Mukesh Ambani’s Reliance Industries, in September 2016, forced rivals to also drop their rates, affecting profit margins. Smaller companies were forced to either shut shop or get acquired, leaving just Airtel, Jio and the merged entity of Vodafone and Idea to compete in the battlefield.
Airtel did not divulge its average revenue per user details.
Performance of the company’s Africa unit has proved to be a beacon of hope as it battles Jio at its home market. Last week, the company announced the earnings for the Africa unit which swung to a quarterly net profit from a year-earlier loss because of an increase in transaction value on its Airtel Money platform and higher data consumption on its network.
The Africa operations posted a net profit of $83 million in the March quarter, compared to a loss of $49 million a year earlier. The improved earnings is significant for Bharti Airtel’s Africa arm, which is gearing up for an initial public offering in June-July.
