Idea Cellular Q3 PAT may rise 13% to Rs 505cr: MOST

Motilal Oswal has come out with its October-December quarter earnings estimates for the telecom space. The brokerage house expects Idea Cellular to report a 13 percent gain quarter-on-quarter (up 121.3 percent Y-o-Y) in net profit at Rs 505.8 crore.

Sales of the company are expected to increase by 3.9 percent Q-o-Q (up 17.8 percent Y-o-Y) to Rs 6,573.1 crore, according to Motilal Oswal.

Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to go up by 5.2 percent Q-o-Q (up 40.8 percent Y-o-Y) to Rs 2,074.8 crore.

Motilal Oswal on Idea Cellular:

We expect consolidated revenue to grow 17.8 percent YoY (4 percent QoQ) to Rs 65.7 bn.

Mobile traffic growth would be 4 percent QoQ (9.5 percent YoY). We expect RPM to remain flat QoQ (8.5 percent growth YoY).

ARPU is likely to increase 2 percent QoQ to Rs 168 (v/s 6% decline in 2QFY14).

Idea trades at an EV/EBITDA of 7.8x FY14E and 6.3x FY15E. Maintain Buy.

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