Bharti Airtel, India's largest telecom service provider, grew its revenues by 7% to Rs 18,477 crore in Q3 of current fiscal over the September 2011 (Q2) quarter. Its earnings before interest, tax, depreciation and amortization grew 2.5% sequentially while net profit declined by 16.6% y-o-y and 1.5% q-o-q to Rs 1,011.3 crore. Bharti’s third quarter performance shows that while it has managed to grow revenues, maintaining profitability is increasingly becoming a challenge.
Bharti reported a higher than expected SG&A of Rs 3,465 crore compared to estimates of Rs 3,116.7 crore. The impact of this higher SG&A spend has hurt the bottom line by Rs 235 crore. The company’s EBITDA margins too have contracted sequentially from 33.6% in Q2 to 32.2% in Q3.
Bharti’s ARPM rose to Rs 0.446 compared with Rs 0.436 a quarter earlier. Consequently, the company’s ARPU (average revenue per user) improved by Rs 4 sequentially to Rs 187 during the quarter.