Reliance Emerges With Q3 Profit
Revenues for the third quarter of fiscal 2006 were Rs 33.27 billion ($748.68 million). Those figures compare with a net loss of Rs 180 million ($4.05 million) on revenues of 27.87 billion ($627.17 million) during the second quarter when the split was announced. The company notes that comparable figures are not available for the previous year as it didn't exist in its current form then.
RCVL was formed when feuding brothers Mukesh and Anil Ambani carved up the Reliance empire, which included telecom, energy, and financial services. The telecom group is made up of four units: fixed-line and CDMA operator Reliance Communications Ltd. , GSM operator Reliance Telecom Ltd., Reliance Communications Infrastructure Ltd., which holds the infrastructure assets, and global networking provider FLAG Telecom Ltd. .
The demerger process was completed on Feb 8 and RCVL plans to list its shares on India's Bombay and National stock exchanges during the second week of March.
Infocomm and Reliance Communications Infrastructure yesterday announced write offs and provisions including bad debts, old inventory, and asset impairment of Rs 45 billion ($1.01 million) relating to fiscal 2005 in preparation for the listing.
The increase in revenues comes as India's telecom subscriber growth continues to skyrocket and Infocomm rolls out a series of initiatives to attract new subscribers. Infocomm, which recently introduced a flat rate pricing scheme for national calls, says it's cutting the price of mobile phones by up to 40 percent and plans to introduce new low-end and multimedia phones to encourage use of CDMA-based data services.
According to industry figures, Reliance Infocomm had 15.58 million subscribers at the end of December, adding one million during that month alone, while Reliance Telecom had 1.67 million. Reliance is India's second largest mobile operator after Bharti Tele-Ventures Ltd. , which ended the year with 17.53 million subscribers. (See Bharti Adds 2.26M Subscribers in Q3.)
Infocomm also announced today a multi-year network services contract with GE Money to provide its 122 locations in India with MPLS-based connectivity.
— Nicole Willing, Reporter, Light Reading