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* Q2 net profit at 5.12 bln rupees vs 6.90 bln rupeesestimate
* Revenue rises 10 percent to 213.24 billion rupees
* EBITDA margin at 32 pct vs 30.6 percent year-ago
* Shares rise as much as 5.5 percent
By Matthias Williams
NEW DELHI, Oct 30 (Reuters) - Bharti Airtel Ltd's better-than-expected operating performance and higher marginsreinforced expectations that India's long-suffering mobile phoneservices market is turning the corner even as the market leaderreported its 15th consecutive quarter of declining profit.
Bharti shares were trading up 3.5 percent at 353.70 rupeesin morning trade after rising as much as 5.5 percent in a Mumbaimarket that was up 0.2 percent.
The outlook for bigger Indian carriers like Bharti Airtel,Vodafone Group Plc's local unit and Idea Cellular has improved this year after a court order invalidatedthe licences of several smaller companies, forcing them toeither shut or scale back operations.
The remaining carriers increased call prices earlier thisyear, the first such hike in almost three years and theycontinue to cut discounts, taking advantage of reducedcompetition. Voice calls are the mainstay for Indian phonecarriers, accounting for 85 percent of the sector's revenue.
Bharti's consolidated net profit fell to 5.12 billion rupees($83 million)for its fiscal second quarter ended Sept. 30 from7.21 billion rupees a year earlier, said New Delhi-based BhartiAirtel, the world's No.4 mobile phone carrier by customers.
A weak rupee led to forex losses of 3.42 billion rupees inthe latest quarter, it said. Analysts on average expected a netprofit of 6.90 billion rupees for the company, nearly a thirdowned by Southeast Asia's top phone carrier SingTel.
The company reported an EBITDA (earnings before interest,taxes, depreciation and amortisation) margin of 32 pct, higherthan 30.6 pct in the year-ago quarter.
Bharti and its main rivals do however face a steep increasein the cost of radio spectrum and hundreds of millions ofdollars in government fees and fines after a upheaval in rulesafter a massive telecoms licensing scandal that came to light in2010.
In India, Bharti's monthly average revenue per user, a keymetric for telecommunications companies, fell 4 percent 192rupees from the previous quarter.
Total voice minutes sold fell 3 percent sequentially in whatis typically seen as a seasonally weak quarter for Indiancarriers as frequent power cuts in rural areas and networkoutages during monsoon rains hurt traffic growth.
Separately, Bharti's African business, which it acquired for$9 billion in 2010, has yet to turn a profit, weighing on itsconsolidated earnings. In Africa, monthly average revenue peruser rose 5 percent to $5.7 sequentially.
The company's consolidated net debt was at $9.7 billion atend-September.
"Even as we need sustenance of good performance in Africa tochange our view there, the quarter provided ample data points tosupport out positive view on the India wireless business," KotakInstitutional Equities said in a report.
Bharti, which launched high-speed 3G data networks in 2011,is pushing to increase its revenue share from the premiumservices that offer higher margins than bread-and-butter voiceoperations.
The company has also launched 4G networks in some cities andthis month took full control of a joint-venture 4G broadbandbusiness a year earlier than planned, signalling its intent toexpand the services rapidly.
Idea Cellular Ltd, India's No.3 carrier byrevenue, last week reported quarterly profit surged, butoperating metrics such as average revenue per user and sales ofcall minutes fell.
Bharti Airtel operates across 20 countries in Asia andAfrica. India is its main market accounting for about 70 percentof the total revenue.
