Jio logs first net profit of Rs 504 crore in Dec quarter

New Delhi: Billionnaire Mukesh Ambani’s telecom arm Reliance Jio, which has been blamed for the declining profitability in the sector, today broke into profits in just second quarter of commercial operations on the back of its cheap data offerings.

Reliance Jio posted net profit of Rs 504 crore for the three months ended December 31, 2017, against a loss of Rs 271 crore in September quarter. Ambani had returned to the telecom sector in September 2016 with Jio’s disruptive offerings of free voice and data that weaned away subscribers from established operators.

Jio started commercial operations in second quarter of 2017-18 fiscal. It has often been blamed by the industry for falling profits and financial distress in the sector. Bharti Airtel, India’s largest telecom operator yesterday reported its seventh straight quarter of profit decline.

The Sunil Mittal-promoted company reported over 39 per cent fall in its consolidated net profit for the third quarter this fiscal to about Rs 306 crore. Jio today claimed it is world’s fastest growing digital services platform and country’s largest wireless data subscriber base.

“Jio’s strong financial result reflects the fundamental strength of the business, significant efficiencies and right strategic initiatives. Jio has demonstrated that it can sustain its strong financial performance,” Mukesh Ambani, Chairman, Reliance Industries said in a statement.

The company is committed to push newer innovative products, which would radically transform customer lives and generate huge societal value, he added.

The revenue from operations came in at Rs 6,879 crore, 12 per cent higher than the trailing quarter. The earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 82.1 per cent sequentially to end at Rs 2,628 crore during December quarter.

The operating profit margin improved quarter-over-quarter to 38.2 per cent (23.5 per cent in September quarter). Jio’s subscriber base as on December 31, 2017 stood at 160.1 million.

The gross subscriber addition stood at 27.8 million during the quarter with net subscriber addition at 21.5 million. Jio’s average revenue per user was pegged at Rs 154 each subscriber per month.

Amongst other operational metrics, Jio logged total wireless data traffic of 431 crore GB (9.6 GB per subscriber per month), while the overall voice traffic was 31,113 crore minutes.

The video consumption crossed 200 crore hours per month on the network (13.4 hours of video consumption per subscriber per month), the statement added. The company said it is on track to achieve 99 per cent population coverage during the year.

The growth in Jio’s subscriber base is getting further accelerated through the launch of JioPhone — its 4G-enabled feature phone priced at “effective” zero, that wooed low income users with life-long free voice calls and cheap data bundled with the handset.

“Reliance Retail is geared to increase capacity of supply of JioPhone, considering the tremendous response from Indians to embrace Digital Life,” Jio statement said.