Reliance Jio turns profitable, adds 27.8 million users in third quarter of 2017-18
Reliance Industries has consolidated its position as the third largest telecom services provider in India, and with the launch of JioPhone, it will lead to higher data consumption in the country.
Reliance Industries' telecom arm Reliance Jio turned profitable in the third quarter of financial year 2018, reporting its first-ever quarterly net profit of Rs 504 crore, as against a net loss of Rs 271 crore in the previous quarter. The parent reported a consolidated net profit of Rs 9,423 crore for the quarter under review.
In less than 18 months of its launch, Reliance Jio reportedly had a subscriber base of over 160 million as on December 31. The company reported an average revenue per user of Rs 154 per month. Jio's subscriber base has continued its strong subscriber growth trend with gross additions of 27.8 million (as against 19.5 million in the previous quarter) during the quarter, while net additions for the quarter stood at 21.5 million (15.3 million in the trailing quarter).
Reliance Jio reaped rich benefits from owning its data services and a large fibre optic network after it entered into a joint venture with Anil Ambani’s Reliance Communications.
Jio continues to remain the fastest growing digital services company, demonstrating a high activity level with average data consumption per user per month of 9.6 GB and average voice consumption of 694 minutes per user per month.
Video consumption has crossed 200 crore hours per month on the network. The customer churn stood at 1.4 percent per month and is the lowest in the industry.
Mayuresh Joshi, Fund Manager, Angel Broking, says, “The top three-four players will need to strengthen the infrastructure network in terms of spectrum offerings as well as product efficiencies to facilitate customers to migrate to the new network for which additional capital flow is a primary necessity. It is evident from the revisions in pricing by Reliance Jio that the telecom industry pricing competition pressure is almost nearing its end. What it also indicates is as data consumption grows exponentially across circles, the existing telecom players will also benefit.”