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Reliance Communications reports 33 percent drop in quarterly profit

Reliance Communications reports 33 percent drop in quarterly profit

By Reuters | Updated: 1 August 2013 18:06 IST

Mobile carrier Reliance Communications Ltd reported a 33 percent drop in quarterly profit, weighed down by higher finance costs even as pricing power improved due to reduced competition.

Reliance Communications, the most-leveraged among listed Indian phone carriers, said on Thursday consolidated net profit fell to 1.08 billion rupees from 1.62 billion rupees a year earlier.

That was the fourth consecutive quarter of declining profits at the company, controlled by billionaire Anil Ambani, with profits falling in 14 of the last 16 quarters.

Analysts expected the company to report a profit of 2.87 billion rupees, according to the average estimates of five analysts on Thomson Reuters I/B/E/S.

Reliance Communications, like its main rivals, has raised call prices in recent months after competition eased due to the exit of some smaller players, but its debt load has hurt its profitability.

The company has sealed two deals to lease its mobile phone towers and fibre optic network to a 4G venture of Reliance Industries Ltd, leading to a 76 percent surge in Reliance Communications' stock price so far this year.

Copyright Thomson Reuters 2013

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