From 13 Crore To 3 Lakh: Kumar Mangalam Birla Takes Big Pay Cut At Idea
Mr Birla's compensation from Idea shrank to Rs. 3.3 lakh in 2016-17 Mr Birla got 0.42% of average salary drawn by Idea's employees Aditya Birla Group company didn't pay any commission to the chairman
Kumar Mangalam Birla, head of the Aditya Birla Group and chairman of Idea Cellular, saw his compensation from serving on Idea's board shrink from Rs 13.15 crore in 2015-16 to Rs 3.3 lakh in 2016-17, according to the telecom company's annual report. The report said that Mr Birla received just 0.42 per cent or less than half of the average annual salary drawn by Idea's employees. The Aditya Birla Group company didn't pay any commission to the chairman or other non-executive directors for the year. The year 2016-17 also marked the first year that Idea reported an annual loss after going public.
Indian telecom market is seeing intensified competition following the entry late last year of Reliance Industries' Jio, which has forced other operators to slash rates to retain customers. Bharti Airtel, India's largest mobile telecoms network operator, reported its smallest quarterly profit in more than four years, as free voice services offered by Jio sparked a price war which has eroded margins.
Meanwhile, Vodafone's India unit and Idea have announced a merger to create the country's largest mobile phone operator.
Referring to the intense competition in the sector and Jio, Mr Birla in his annual note to shareholders, said, "For the first time in its history, the flourishing Indian Mobility industry, is trending towards an annual revenue decline of around 2% in FY17."
"With the new entrant starting to charge for its services, albeit very slowly, the sector is expected to return to growth in the next financial year," he added.