Bharti Airtel Ltd. (BHARTI), India’s largest mobile-phone operator, reported first-quarter profit slumped 37 percent, missing analyst estimates, after costs increased.
Net income fell to 7.62 billion rupees ($138 million) in the three months ended June 30, from 12.2 billion rupees a year earlier, New Delhi-based Bharti said today. That lagged behind the 12.2 billion-rupee median of 33 analysts’ estimates compiled by Bloomberg.
Bharti joined rival Vodafone Group Plc (VOD) in cutting prices for third-generation data services at least 70 percent in India, where a price war sparked by the entry of operators including Telenor ASA (TEL) and NTT DoCoMo Inc. (9437) drove voice call rates as low as a penny a minute. Bharti, controlled by billionaire Sunil Mittal, also spent more to expand its network, adding to rising finance costs from its acquisition of the African assets of Kuwait’s Mobile Telecommunications Co. (ZAIN)
“They’ve given discounts in 3G, and Bharti and a lot of other players have launched offers of vouchers as well--revenue per minute will come down definitely because of that,” Ankita Somani, an analyst at Angel Broking Ltd. in Mumbai, said before the results were announced. “Interest costs are also higher now because of forex movement.”
To contact the reporter on this story: Ketaki Gokhale in Mumbai at kgokhale@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
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