Indian billionaire's free data and voice strategy is paying off
Billionaire Mukesh Ambani, who upended India's mobile-phone market with free data and voice services a year ago, reported the business had made profit before interest and taxes as he began charging for data.
Reliance Jio Infocomm reported a 2.6 billion rupee (€34m) profit before interest and taxes, the company said in a statement on Friday.
It's the first time Ambani, India's richest man, has disclosed earnings for the business. The company reported a net loss of 2.71 billion rupees.
Despite being the newest entrant in what was already one of the world's most crowded mobile-phone markets, Jio has accumulated more than 138.6 million subscribers and has triggered a shakeout in the industry by undercutting prices.
That has prompted existing carriers to slash their tariffs and pursue mergers to survive.
Industry leader Bharti Airtel said this week it would buy Tata Group's mobile-phone business, months after agreeing to acquire Telenor ASA's local operations.
Vodafone Group and Idea Cellular are in the process of merging their Indian operations to create the nation's largest carrier.
Reliance Communications had planned to merge with Aircel, but that deal fell apart in early October.
Shares of oil refiner Reliance Industries, which controls Reliance Jio Infocomm, rose 0.4pc to 876.45 rupees at the close of trading in Mumbai on Friday,
Jio, which already ranks fourth locally in terms of mobile subscribers, is planning further market share gains.
The company is offering a €19 mobile that offers 4G data plans that cost as low as 23 rupees (30 euro cents) for two days or 153 rupees monthly.
Sunday Indo Business