Idea Cellular shares tank over 6% as Q1 profit plunges

Shares of telecom operator Idea Cellular today plunged over 6 per cent after the company reported a sharp decline of 74.5 per cent in consolidated net profit for three months period ended June 30.

The scrip after a weak opening, further lost 6.35 per cent to Rs 96.55 — its 52-week low — on BSE.

At NSE, shares of the company tanked 6.15 per cent to Rs 96.75.

Idea Cellular yesterday reported a sharp decline of 74.5 per cent in consolidated net profit at Rs 217 crore for three months period ended June 30, largely on account of spectrum purchase.

The company had posted a profit of Rs 851.6 crore in the same quarter a year ago.

Idea Cellular however maintained that the financial results are not comparable due to one-time payment related to spectrum purchase.

The financial performance of reported quarter includes "full impact of spectrum acquired by Idea in March 2015 (Rs 30,140 crore investment) and February 2014 Auction (Rs 10,420 crore investment) for renewal of mobile licences in nine service areas expired between December 2015 and April 2016 as well as spectrum acquired for 3G and 4G services in multiple circles.

The total revenue of Idea Cellular increased by 7.9 per cent at Rs 9,486.64 crore in the reported quarter compared to Rs 8,791.54 crore a year ago.