Idea Cellular declines on brokerage downgrade

Idea Cellular lost 2.34% to Rs 72.95 at 14:46 IST on BSE on reports a foreign brokerage has downgraded the stock to underperform.

Meanwhile, the S&P BSE Sensex was down 92.62 points or 0.34% at 26,785.62.

On the BSE, 3.35 lakh shares were traded on the counter so far as against the average daily volumes of 6.97 lakh shares in the past one quarter. The stock had hit a high of Rs 74.65 and a low of Rs 72.70 so far during the day.

The stock had hit a 52-week high of Rs 137.85 on 6 January 2016 and a 52-week low of Rs 66 on 9 November 2016. It had outperformed the market over the past one month till 5 January 2017, advancing 2.75% compared with the Sensex's 2.01% rise. The scrip had, however, underperformed the market in past one quarter, declining 6.57% as against the Sensex's 4.76% fall.

The large-cap company has equity capital of Rs 3601.69 crore. Face value per share is Rs 10.

The brokerage sees significant decline in operating profit of Idea Cellular going forward. Unlimited voice uptake makes risk-reward unfavourable, it added.

On a consolidated basis, Idea Cellular's net profit fell 88% to Rs 91.46 crore on 7.2% growth in net sales to Rs 9298.89 crore in Q2 September 2016 over Q2 September 2015.

Idea Cellular is the third largest wireless operator in India. Idea is part of the Aditya Birla Group, which is one of the largest business groups in India.

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