MUMBAI: Kumar Mangalam Birla’s remuneration from Idea Cellular in fiscal 2017 shrank to a small fraction of what he earned the year before, after the telecom operator reported its first annual net loss as a listed entity.
The chairman took home just Rs 3.30 lakh, compared with Rs 13.15 crore in the fiscal year ended March 2016, its annual report showed. The Aditya Birla Group company didn’t pay any commission to the chairman or other non-executive directors for the year, which was also the first when it reported a drop in revenue since its IPO a decade ago.
The past year had been one of the toughest for Idea and larger rivals Bharti Airtel and Vodafone India. The entry of Reliance Jio Infocomm to the telecom market with free launch offers dragged them to a bitter and bruising price war. On a consolidated basis, Idea reported a Rs 404 crore loss with revenue falling 0.8% to Rs 35,883 crore. The intensified competition led the company and Vodafone India to announce a merger deal, which is yet to be completed.
The merger is awaiting approvals from various authorities, the report said. “With the new entrant starting to charge for its services, albeit very slowly, the sector is expected to return to growth in next financial year,” Birla said in the report. Among non-executive directors, Sanjeev Aga saw remuneration falling to Rs 5.90 lakh from Rs 16.7 lakh, again in absence of commissions. However, those in the leadership team took home higher salaries.
Managing director Himanshu Kapania’s salary rose 13% to Rs 9.34 crore, while finance chief Akshaya Moondra took home Rs 2.33 crore, up from Rs 2.23 crore the year before. These don’t include stock options. For the average employee, the salary hike was 8%.
In his note to shareholders, Birla said the group has created a leadership pipeline with its initiatives to develop the next line of top brass.
“This has yielded significant changes to internal processes, delegation of authority and speed of decision making, in turn empowering teams and freeing up leadership bandwidth,” he said.