IDEA CELLULAR = Q3 FY 2011 RESULTS = FOR QTR ENDING DECEMBER, 2010 = IMPROVING FINANCIALS = BUT COMPETITION IS HIGH

Idea Cellular Limited

NSE Symbol IDEA

CONSOLIDATED RESULTS

IDEA CELLULAR  has declared good consolidated results for 3^rd quarter ending December,2010.

NET SALES  has increased to Rs.3953 Cr – up by 8.69% from Q2 FY 11 and Up by 26.05% from Q3 FY 2010.

Profit from Operations is Rs.356 Cr – up by 19.84% from Q2 FY 11 and up by 18.14% from Q3 FY 2010.

CONSOLIDATED NET PROFIT is Rs.243 cr – up by 35.22% from Q2 FY 2011 and up by a good 42.88% from Q3 FY 2010.

Basic EPS on a Face Value of Rs.10 is Rs.0.74      - up from Rs.0.54 in Q2 FY 2011 and up from Rs.0.55 in Q3 FY 2011.

IDEA CELLULAR -CONSOL	Q3 FY 11	Q2 FY 11	Q3 FY 10
Net Sales	395259	363665	313582
DIF %1	3953	8.69	26.05
Other Oprtg Income	302	2254	1365
Employees Cost	20721	21551	17843
Depreciation	59254	58201	51305
Other Expenditure	279058	255510	214945
Total Expenditure	359990	336237	284838
Profit from Operations	35571	29682	30109
DIF %2	356	19.84	18.14
Profit B I & EI	35571	29682	30109
Interest	9411	10279	9379
Profit A I BB EI	26160	19403	20730
Profit before tax	26160	19403	20730
Tax Expense	1855	1429	3719
Net Profit  after tax	24305	17974	17011
Net Profit	24305	17974	17011
Consolidated Net Profit	24305	17974	17011
DIF %3	243	35.22	42.88
Face Value (in Rs.)	10	10	10
Paid-up Equity	330156	330098	310010
Basic EPS	0.74	0.54	0.55
Public holding (%)	-	53.03	50.95

WHAT COMPANY SAYS :

Yet Another Quarter of Growing Competitiveness

Riding on improved seasonal demand in the October-December quarter, and upon the longer term trend of expanding market share, Idea grew its total Minutes on Network by 10.2%, while Standalone Revenue expanded by 8.2%, on a sequential quarterly basis. The Average Realised Rate per minute declined marginally to 41.8p, compared to 42.3p in the previous quarter.

During the quarter, the increase in Advertising and in Subscriber Acquisition & Servicing costs by ~2.5% (as a percentage of revenue), were substantially cushioned by volume led cost efficiencies, resulting in almost flat EBITDA margins. The EBITDA losses from the New Service Areas also remained almost unchanged in absolute terms, but exhibited an improvement in percentage terms.

During the quarter, interest of Rs. 1,242 mn was capitalised against the payment for 3G auction fee. On a standalone basis, the PAT for the quarter stands at Rs. 2,209 mn, up 35.5% on a sequential basis, while Cash Profit of Rs. 7,674 mn grew by 9.9%.

The Net Debt as of December 31, 2010 stands at Rs. 92,924mn and the Net Debt - Equity ratio is 0.77. The Net-Worth of Rs. 120,098mn, together with an average Cash Profit of ~Rs. 7,000 mn per quarter, provides a solid foundation to support the company’s strategic intent.

The preparatory work for 3G rollout is on track, and Idea will, in next few months, launch 3G services in the 11 service areas where it won the 3G spectrum. Further, Idea is finalising long-term arrangements with select quality operators for service areas where Idea was not awarded 3G spectrum. Together, these will enable Idea subscribers, throughout the country, to enjoy what will be the gold standard in 3G services, apart from deriving the benefit of nation-wide roaming.

During the quarter, Idea rolled out 2,228 cell sites, taking EoP cell sites to 70,208. Total addition to the Gross Block including CWIP was Rs. 9,471mn for Q3 FY11. With this, the total addition to Gross Block including CWIP for YTD Q3 FY11 is Rs 17.5bn, whereas our capex guidance for the full year FY11 now stands revised to Rs 30bn (both excluding 3G spectrum fee and interest thereon). The lowered guidance is on account of some spill over into the next quarter, as also savings against earlier estimates.

STAND ALONE RESULTS TABLE :

The stand Alone results reflect a similar picture as below – as seen in consolidated results.

Basic EPS  is Rs.0.67 – against Rs.0.5 in Q2 FY 11 and Rs.0.7 in Q3 FY 10.

IDEA CELLULAR	31-Dec-10	30-Sep-10	30-Jun-10	31-Mar-10	31-Dec-09
Net Sales	392718	361217	362641	321190	291157
Other Operating Income	187	1675	320	2769	1197
Total Expenditure	364626	339387	334694	289902	260571
Net Profit	22106	16598	20164	26249	21838
Face Value (In Rs	10	10	10	10	10
Paid Up Equity	330156	330098	330023	329984	310010
Basic EPS	0.67	0.5	0.61	0.84	0.7
Public holding (%)	0	53.03	53.02	53.01	50.95

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