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Jio Announces Q2FY 2020 Financial Results

Posted by Reliance

Highlights of Quarter’s (Q2 – FY 2019-20) Performance

  • Standalone revenue from operations of Rs. 12,354 crore
  • Standalone EBITDA of Rs. 5,166 crore and EBITDA margin of 8%
  • Standalone Net Profit of Rs. 990 crore
  • Subscriber base as on 30th September 2019 of 355.2 million (40.8% YoY growth)
  • Lowest churn in the industry at 0.74% per month
  • ARPU during the quarter of Rs. 120 per subscriber per month
  • Total wireless data traffic during the quarter of 1,202 crore GB (55.9% YoY growth)
  • Total voice traffic during the quarter of 81,262 crore minutes (52.2% YoY growth)

Commenting on the results, Shri Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited said: “Jio crossed the 350 million subscriber mark to remain the world’s fastest growing digital services company, and we are still adding more than 10 million new customers every month. Jio is not only India’s largest telecom enterprise in terms of subscribers and revenues but has also become the Digital Gateway of India.

After tremendous success on mobile broadband connectivity business, Jio is now geared up to kick-start other growth engines – Home Broadband, Enterprise Services, Small & Medium Business connectivity, and Internet of Things (IoT). This along with digital platforms and solutions across Blockchain, Edge Compute, Artificial Intelligence, and Cloud infrastructure which have been developed by a strong talent pool within the Reliance Group would transform India into an AI-first economy across all sectors.”

Jio continues to be the Operator of Choice

  • Strong subscriber growth with net addition of 24 million during the quarter and 103 million during the previous twelve
  • Gross adds at 6 million stayed healthy with deeper 4G network presence and affordable tariffs continuing to attract first time mobile internet users to Jio digital services.
  • Monthly churn rate reduced sequentially and continued below industry average at 74%.
  • Customer engagement continues to surprise positively with average data consumption per user per month of 11.7 GB (11.4 GB per user per month in the previous quarter) and average voice consumption of 789 minutes per user per
  • Jio management has remained focused on offering best value to its customers, and on driving customer engagement with best-in-class content bouquet, seamless network performance and affordable tariff
  • JioPhone Diwali 2019 plan (marketed by Reliance Retail) offering the device at ₹699 (without an exchange of old device) has witnessed a strong response in first few weeks. Jio is committed to ensure that no Indian is deprived of affordable Internet and fruits of the Digital

Resilient network performance at a large scale

  • Jio has witnessed more than 3x increase in voice and data traffic on its network, over the past two years. However, with >750K eNodeBs (across 800MHz/ 1800MHz/ 2300MHz bands) deployed on 4G-LTE, Jio continues to be by far the industry leader in terms of network capacity and performance (average download speed of 21.3 Mbps during August 2019, as per TRAI).
  • World’s largest VoLTE network continues to get bigger with ~52% YoY growth in daily voice traffic and is extending its lead over legacy 2G/3G voice networks in
  • Besides higher capacity on account on larger deployment of spectrum on 4G technology, extensive fiber backhaul supports higher throughput and better customer
  • World class network design with real time data collection/aggregation, business workflow engines and predictive analytics/algorithms drives better planning, higher efficiency and lower

Update on InvIT controlled Fibre and Tower SPVs

  • Fiber and Tower undertakings were transferred to Jio Digital Fibre Private Limited (“JDFPL”) and Reliance Jio Infratel Private Limited (“RJIPL”) respectively, effective 31-Mar- 2019.
  • JDFPL and RJIPL are operating as independent entities with transfer of control to the SEBI registered Infrastructure Investment
  • Transaction for subscription of units of Tower InvIT by Brookfield Infrastructure Partners

L.P. and its affiliates is in final stages.

FTTH and Enterprise Services rolled out commercially during the quarter

  • After successful beta trials of FTTH services, Jio announced rollout of Home and Enterprise services during 42nd AGM (Post-IPO) of Reliance Industries Limited on 12th August
  • We have received strong interest across the 1,600+ cities where the services would be launched The process of converting >0.5 million existing trial users to paid bundled plans is ongoing. We expect FTTH and Enterprise services to be key growth and margin tailwind over the medium term.

Largest Distribution and Service Network

  • Pan-India distribution channel with over 1 million retailers for customer acquisition and selling
  • Efficient sales channel with best value offering continues to deliver with monthly gross subscriber additions at more than 10 million during the
  • MyJio is the best-in-class full service (prepaid and post-paid payments, loyalty coupons, troubleshooting, addition or deletion of services) self-care

Robust Financial Performance led by resilient business model

  • Jio continues to deliver healthy financial performance primarily led by subscriber momentum and cost
  • Quarterly operating revenue increased 33.7% YoY to ₹ 12,354
  • Operational efficiency is reflected in industry leading EBITDA margin of 8% (up 315bps YoY) which has driven EBITDA to Rs. 5,166 crore during the quarter.

UNAUDITED STANDALONE FINANCIAL RESULTS FOR QUARTER/HALF YEAR ENDED 30TH SEPTEMBER 2019

UNAUDITED STANDALONE BALANCE SHEET AS AT 30th SEPTEMBER 2019

NOTES:

  1. The figures for the corresponding previous period have been regrouped wherever necessary, to make them
  2. The Company continues to invest in augmentation of the wireless network capacity and setting up wireline telecommunication
  3. The Company is mainly engaged in the business of providing Digital All activities of the Company revolve around this main business. Accordingly, the Company has a single segment as per the requirements of Ind AS 108 – Operating Segments
  4. The Company during the previous quarter has issued and allotted 400 crore 9% Non- Cumulative Optionally Convertible Preference Shares (‘OCPS’) (Series-V) of Rs. 10/- each for cash, at a premium of ₹ 40 per OCPS aggregating Rs. 20,000 crore to Reliance Industries Limited, the holding
  5. The Company during the previous quarter has bought back from the open market 6,390 “8% RJIL (PPD 12)” and 4,750 “8% RJIL (PPD 13)” Secured Redeemable Non-Convertible Debentures of Rs. 10,00,000 each for cash, aggregating face value of Rs. 1,114
  6. Details of Non-Convertible Debentures are as follows:

7. Credit rating and change in credit rating (if any):

The Company has retained its credit ratings of “CRISIL AAA (SO)/ Stable” by CRISIL and “CARE AAA (SO)” by CARE for series PPD 1 and series PPD 2. “CRISIL AAA/ Stable” by CRISIL and “ICRA AAA/ Stable” by ICRA Limited for series PPD 3 to series PPD 5 and for series PPD 8 and series PPD 11. “CARE AAA/Stable” by CARE, “CRISIL AAA/ Stable” by CRISIL and “ICRA AAA/ Stable” by ICRA Limited for series PPD 12 to series PPD 16.

8.The Company has adopted Ind AS 116 ‘Leases’ effective 1st April 2019 and applied the Standard to its leases. This has resulted in recognizing a right-of-use asset included in Property, Plant and Equipment and a corresponding lease liability of Rs. 6,633 crore as at 1stApril 2019. The impact on the profit for the quarter/half year is not

9. Formulae for computation of ratios are as follows:

a) Debt Equity Ratio = Debt/Equity

As per Accounting Standard, Other Equity is in nature of Equity and thus, it is included for the purpose of calculation of Debt-Equity Ratio. Debt capital comprises debentures, term loans and other short-term borrowings.

b) Debt Service Coverage Ratio = Earnings before interest and tax

Interest Expense + Principal Repayments made during the period for long term loans

c) Interest Service Coverage Ratio = Earnings before interest and tax

Interest Expense

10. The Non-Convertible Debentures of the Company aggregating Rs. 13,386  crore  as  at 30th September 2019 are secured by way of pari passu charge on the Company’s certain movable properties and the asset cover thereof exceeds hundred percent of the principal amount of the said

11. The results of the quarter / half year ended 30th September 2019 are not comparable with the corresponding figures for the previous periods to the extent of the demerger of the Optic Fibre Cable Undertaking and transfer of Tower Infrastructure Undertaking of the Company pursuant to Composite Scheme of Arrangement with appointed date as 31st March

12. The Audit Committee has reviewed the above results and the Board of Directors has approved the above results and its release at their respective meetings held on 18thOctober 2019. The Statutory Auditors of the Company have carried out a Limited Review of the aforesaid.―CT Bureau

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