Reliance Communication - PAT down 65% qoq, Maintain Reduce: Emkay

Please Share:: India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��

Reliance Communication

PAT down 65% qoq, Maintain Reduce

REDUCE

CMP: Rs 88                                       Target Price: Rs 85

---

n     Change in accounting policy to include IRU sales of 25.5bn led to spike in revenues. Ex-IRU revenue, topline improved by just 1.3% qoq. Mobility revenue was up 3.3% qoq 

n     ARPU fell 3.5% QoQ to Rs107 purely on MOU decline as RPM remains stable. Wireless traffic improved 3.2% on the back of  paid minutes coming on network

n     Net profit slumps to Rs1.7bn declining 64.9% qoq, led by lower margins across the business segments. Capex guidance at 15bn for FY12E, positive for peers 

n     Maintain our REDUCE rating with target price of Rs85 Valuations at 5.6x and 4.7x EV/EBIDTA  for FY12E and FY13E respectively