Indian telecoms carrier Reliance Communications (RCom) posted its third straight quarterly loss on Saturday as its heavy debt load and a price war triggered by an upstart rival continued to weigh on sales and profit.
RCom, controlled by billionaire Anil Ambani, has won a reprieve on its debt until the end of the year as it works on two asset sale deals that it expects will reduce its $7 billion debt by about 60 percent.
On Saturday, it reported a net loss of 12.21 billion Indian rupees ($190.38 million) for its fiscal first quarter ended June, against a profit of 540 million rupees a year earlier.
Revenue from operations fell 33.6 percent year-on-year to 34.94 billion rupees, while finance costs rose to 9.98 billion rupees.
The company`s continued losses are, in part, a result of competition from free voice and cut-price data plans offered by Reliance Jio Infocomm, the telecom startup backed by Ambani`s elder brother Mukesh.
Jio has upended India`s uber-competitive telecom sector, forcing all incumbents to drop prices despite falling margins and profits.
But RCom`s struggle with its debt load and little success with its initial bet on a network based on CDMA technology have also led to its current financial situation.
RCom, whose mobile phone unit is India`s seventh-ranked carrier with 82.3 million customers as of end-May, is awaiting regulatory approval for a merger of the unit with rival Aircel. It has also agreed a deal with Canada`s Brookfield to sell a stake in its mobile masts business.
The company has previously said it expected the transactions to close by September.
Worries over the company`s ability to repay debt have led to a series of downgrades by ratings agencies and the company`s stock has plummeted 39 percent so far this year compared with an 18 percent rise of a broader Mumbai market.($1 = 64.1350 Indian rupees)