BSNL swings back to loss after 2 profitable quarters
What's the story
Bharat Sanchar Nigam Limited (BSNL) has reported a net loss of ₹1,049 crore for the June quarter. This is a major turnaround from the profit of ₹280 crore and ₹262 crore in the March and December quarters, respectively. The company's revenue from operations also declined by 24% quarter-on-quarter to ₹5,029.6 crore due to declines across all segments, ie. consumer mobility, enterprise, and consumer fixed access.
Cost analysis
Employee costs surge amid financial challenges
Despite a dip in total expenses, employee costs have risen sharply for BSNL. The company's total expenses fell 9.4% sequentially to ₹6,840 crore. However, employee costs, which account for a major chunk of its revenue rose by 39% QoQ to ₹1,940 crore. This increase has contributed significantly to the company's financial woes in the June quarter.
Revenue growth
Year-on-year losses narrowed for BSNL
On a year-on-year basis, BSNL's losses narrowed during the quarter from ₹1,542 crore in the same period last year. This was largely due to a 14.5% jump in revenue from ₹4,392.6 crore, driven by the roll-out of its 4G services at close to 100,000 sites and lower tariffs. The firm also saw a 43% on-year increase in depreciation and amortization expenses to ₹1,940 crore.
Subscriber details
Mobile subscriber numbers show mixed trends
BSNL had 90.46 million mobile subscribers as of June-end, a decline of 0.6 million from March-end. However, the subscriber base has grown by nearly 5.5 million since June 2024 when the firm had 85.6 million users. Telecom Minister Jyotiraditya Scindia has asked BSNL to target a 50% growth in its mobile services business and a 25-30% increase in the enterprise segment by 2026.
Financial support
Government's ₹47,000cr capex boost
The Indian government has announced a ₹47,000 crore capex boost for BSNL. The funds will be used to upgrade networks and drive growth in mobile and enterprise services by next year. Despite the recent losses, the government remains optimistic about BSNL's potential to turn around its fortunes with these strategic investments and growth plans.