Bharti Airtel reported dive in quarterly profit

Bharti Airtel, India’s leading mobile phone firm by subscribers, reported on 2nd May 2012 about 28 percent dive in quarterly net profit,  hit by debt charges and foreign exchange losses.

The mobile phone operator said net profit slid to 10.06 billion rupees ($191 million) in the three months of this year.

Its Bharti’s ninth straight quarterly profit drop in India’s fiercely competitive mobile market.

Bharti’s $10.7-billion debt-funded purchase in 2010 of mobile operations of Kuwait’s Zain in Africa and interest charges from its $3.2-billion acquisition of 3G spectrum in India weighed on earnings.

Foreign exchange losses and tax provisions also dragged down profit.

However, revenues climbed 15 percent to 187.29 billion rupees as Bharti’s average revenue per user — a key performance measure — increased 1.1 percent.

Its customers also jumped nearly six million in the final quarter to 181.3 million, double the addition in the previous three months.

Bharti’s shares rose 2.05 percent to 316.65 after the results announced, outpacing a slightly firmer overall market.

The earnings came amidst turmoil in India’s telecom market after Supreme Court cancelled 122 (2G) mobile licences issued in 2008 on grounds of irregularities.

Indian telecom regulator proposed that the government auction the airwaves using a reserve price nearly 10 times the price used in 2008, raising alarm in the sector.