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The stock of Bharti Airtel rallied 6 per cent last week despite weak results. Strong competition and free services by Reliance Jio impacted the company’s performance, but the market seemed please by good addition to the customer base.
Airtel’s revenue declined 12 per cent in the March quarter due to sustained free services of Jio, which resulted in migration of customers. The revenue fall coupled with increase in finance costs, litigation and regulatory levies led to a 72 per cent drop in net profit.
But on a positive note, the customer base expanded about 9 per cent, despite the churn. Voice minutes charged increased 24 per cent along with 53 per cent jump in data usage. The average revenue per user (ARPU) though declined in both voice and data by 17 per cent due to reduction in tariff.
The Telenor and Tikona acqusitions bolstered Airtel’s spectrum but increased the net debt to ₹91,399 crore as on March 2017 from ₹83,510 crore a year back.
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