Reliance Jio Infocomm, a subsidiary of Jio Platforms, reported a year-on-year growth of 23.8 percent in its standalone net profit of Rs 4,335 crore for the quarter ended June 2022 (Q1FY23) compared to Rs 3,501 crore achieved a year ago.
On a sequential basis, the profit has grown 3.9 percent from Rs 4,173 crore recorded in the January–March quarter. Jio Platforms is the digital unit of Reliance Industries.
The company recorded revenues of Rs 21,873 crore for the reported quarter, which is a growth of 21.6 percent from Rs 17,994 crore a year back. Sequentially, the revenues increased 4.7 percent on Rs 20,901 crore reported during the previous quarter.
“Customer engagement on our Digital Services platform remains high”, said Mukesh D Ambani, Chairman & Managing Director, while commenting on the performance of the business. “Jio is working towards expanding data availability for all Indians and I am pleased to see the positive trends in mobility and FTTH subscriber additions”.
ARPU & Customer Base
The growth in revenues during the quarter was driven by an increase in average revenue per user (ARPU) as well as a modest addition to its subscriber base.
The ARPU during the quarter stood at Rs 175.7 per subscriber per month with a YoY growth of 27 percent while sequentially the ARPU improved by 4.8 percent. This was a result of higher customer engagement and increase in traffic.
The company was able to add 9.7 million customers on a net basis which was driven by continued strength in gross additions which stood at 35.2 million during the quarter. The impact of SIM consolidation witnessed a decline as compared to the previous quarters.
Reliance Jio is ranked number 1 telecom operator in India with a subscriber base of 419.9 million as at the end of Q1FY23 and has a market leadership with 53 percent of wireless broadband market share in May 2022.
Data Consumption
The average data and voice consumption per user per month during the quarter increased to 20.8 GB and 1,001 minutes respectively.
The total data consumption during the quarter stood at 2,587 crore GB, up from 2,461 crore GB during the March 2022 ending quarter.
The company enjoys ~60 percent market share of data traffic which is more than the combined data traffic of next two competitors.
The voice on network witnessed a modest improvement to 1,370 crore minutes per day during the quarter from 1,340 crore minutes per day during the previous quarter while the per capita voice consumption increased from 968 minutes per month during the previous quarter to 1,001 minutes per month during the current quarter.
FTTH Business
The company’s FTTH business continue to witness strong traction in home connections and as per the data released by TRAI (Telecom Regulatory Authority of India), the company has garnered more than 80 percent market share of new customer additions in wireline segment.
Margins
EBITDA (Earnings before interest, tax, depreciation and amortization) for the quarter grew 27.2 percent to Rs 10,964 crore as compared to Rs 8,617 crore achieved during the same period a year ago. On a sequential basis, the EBITDA is higher by 4.3 percent from Rs 10,510 crore in the previous quarter.
EBITDA margins for the quarter improved 220 bps (100 bps = 1 percent) on year to 50.1 percent while on a sequential basis, the margins were flat with a marginal decline of 20 bps.
Focus Area
Investors will be closely tracking the company’s bidding strategy in 5G auction as it has already deposited the highest earnest money of Rs 14,000 crore which is 2.5X of what has been deposited by its rival Bharti Airtel.
Disclosure: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
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