Reliance Communications (Q4 FY14)
Rcom’s performance especially on key parameters like volume and pricing data lags that of peers like Bharti and Idea though we remain encouraged by robust growth in data volumes.
May 07, 2014 02:05 IST India Infoline News Service
CMP Rs117, Target Rs105, Downside 10.3%
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Rcom reported better than expected topline growth of 4.8% qoq driven by 15.7% qoq jump in global operations
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Domestic voice revenue declined 1.1% qoq as voice RPM dipped 1.5% qoq while traffic was largely flat qoq
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EBIDTA margin (ex-other income) fell ~170bps qoq on increased staff and SG&A expenses
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Reported PAT includes one-offs in depreciation and deferred tax assets; company guides for FY15 capex of Rs20bn vs Rs15bn in FY14
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Deals with Reliance Jio notwithstanding, retain sell on lack of near term operational triggers
| (Rs m) | Q4 FY14 | Q3 FY14 | % qoq | Q4 FY13 | % yoy |
| Net sales | 54,050 | 51,570 | 4.8 | 51,300 | 5.4 |
| Access & license fees | (10,458) | (10,347) | 1.1 | (10,079) | 3.8 |
| Network opex | (16,119) | (15,538) | 3.7 | (16,340) | (1.4) |
| Staff | (3,073) | (2,508) | 22.5 | (2,125) | 44.6 |
| SG&A | (8,542) | (7,187) | 18.9 | (8,831) | (3.3) |
| Operating profit | 15,858 | 15,990 | (0.8) | 13,925 | 13.9 |
| OPM (%) | 29.3 | 31.0 | (167) bps | 27.1 | 220 bps |
| Depreciation | (17,665) | (9,477) | 86.4 | (10,892) | 62.2 |
| Interest | (9,071) | (7,493) | 21.1 | (7,475) | 21.4 |
| Other income | 2,658 | 2,464 | 7.9 | 8,260 | (67.8) |
| PBT | (8,220) | 1,484 | - | 3,818 | - |
| Tax | 10,258 | (30) | - | (751) | - |
| Minority/Associates | 81 | (370) | - | (39) | - |
| Adjusted PAT | 2,119 | 1,084 | 95.5 | 3,028 | (30.0) |
| Adj. PAT margin (%) | 3.9 | 2.1 | 182 bps | 5.9 | (198) bps |
| Extra ordinary items | (560) | - | - | - | - |
| Reported PAT | 1,559 |
