A continuous fall in revenues for the second straight quarter in July-September, following three consecutive quarters of growth, also weighed on the bottomline.
State-owned Bharat Sanchar Nigam’s (BSNL) net loss has risen to Rupees 1,482 crore in the July-September quarter, from Rupees 1,470 crore in the April-June quarter, standalone financial statements of the company showed.
The higher sequential loss during the quarter can largely be attributed to an increase in expenses on advertisement, business promotion and marketing, interconnect usage charge to other operators, higher revenue share to business partners, bad debt write-off, and expenses on construction contracts, among others.
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On a year-on-year (y-o-y) basis, the company’s net loss narrowed from Rupees 2,033 crore in the corresponding quarter last year largely due to a fall in employee benefit expenses, licence and spectrum fee, finance cost, etc.
A continuous fall in revenues for the second straight quarter in July-September, following three consecutive quarters of growth, also weighed on the bottomline.
BSNL’s revenue from operations fell 5.1% quarter-on-quarter (q-o-q) to Rupees 4,071 crore. On a y-o-y basis, the revenue fell 6.6%.
For the half-financial year ended September, the company’s revenue rose marginally to Rupees 8,360 crore, the standalone statements showed.
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About 14 out of 32 circles during the quarter as well as for the half-year ended September reported a fall in revenue for BSNL, sources in the know said. These 14 circles include Haryana, Andhra Pradesh, Gujarat, Karnataka, Punjab, Sikkim, Tamil Nadu, Jammu and Kashmir, parts of North-East, Telangana, Andaman & Nicobar and Chhattisgarh.
In a recent letter after the results, chairman and managing director PK Purwar has asked all the circle heads to improve their performance in the remaining half of the year. Besides, the circles that performed weak have been asked to share a detailed plan.
“Even while we are rolling out indigenous 4G and 5G services, there is a lot of scope for revenue generation in all existing services that BSNL provides,” Purwar said in the letter. A copy of the letter was reviewed by FE.
“I urge all circles to drive QoS (quality of services), customer service and sales aggressively to achieve greater revenue growth in H2 (second half) of FY23-24…14 circles are negative and they should also strategise to earning more revenue in the remaining part of the year and turn positive,” he added.
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Five circles, including Kerala, North East Task Force, Madhya Pradesh and Himachal Pradesh, which reported growth in the first half of the financial year, slipped to red in the July-September quarter.
The decline in revenues during the quarter can primarily be attributed to a weak performance in cellular business, broadband and enterprise segments. Revenue from the cellular business that accounts for nearly 42% of BSNL’s topline fell 11% y-o-y to Rupees 1,702 crore. Sequentially, the revenue from the cellular business rose 1.6%.
Revenue from the broadband services fell 19% q-o-q to Rupees 855 crore, while that from the enterprise business fell nearly 10% q-o-q and 22% y-o-y to Rupees 952 crore. On a y-o-y basis, the revenue from the broadband segment rose 12%.
BSNL has been continuously losing mobile subscribers for the 20th straight month as of August end, owing to weak network services and absence of 4G services, according to data by the Telecom Regulatory Authority of India (Trai).
The company’s subscriber base was at 95.8 million as of August end. Its active subscribers are nearly half of its total subscribers, according to Trai data.
In the Lok Sabha in August, minister of state for communications Devusinh Chauhan had said BSNL’s operating profit rose 65% y-o-y in FY23 to Rupees 1,559 crore.
“BSNL has been Ebitda-positive since financial year 2020-21,” Chauhan said, adding that BSNL is expected to turn-around with net profit in the financial year 2026-27, with the implementation of revival packages.
The government has set the revenue target of the company at Rupees 20,008 crore in FY24. For FY25 and FY26, the company has revenue targets of Rupees 24,428 crore and Rupees 28,476 crore, respectively.
BSNL has currently deployed the 4G network in pilot mode across 200 tower sites in three districts of Punjab – Ferozepur, Pathankot, and Amritsar.
Last month, Purwar told FE that BSNL will start rolling out 4G services commercially from December, with a target of pan-India rollout by June 2024. The company will first deploy the services in Punjab, followed by Haryana, Uttarakhand and other circles. After testing the 4G services on 200 tower sites, BSNL will complete installing another 3,000 4G sites by November end, and will continue to increase the number, Purwar had said.
