Vodafone Idea Q3 net loss narrows to ₹4,532 crore; Arpu up at ₹121
Vodafone Idea Ltd (Vi) reported a net loss of ₹4,532 crore for the December quarter, lower than the ₹6,439 crore in the year-ago, driven by higher 4G wireless customer additions, improved service quality and cost optimization, the company said on Saturday. India’s third largest telecom operator by market share had posted a net loss of ₹7,218 crore in the September quarter.
The board has also approved fundraising of up to ₹25,000 crore in debt and equity, Vi said in a statement. The company is currently in “active discussions with potential investors”, it added.
Vi reported revenue of ₹10,891 crore in October-December, down from ₹11,089 crore in the year-ago. However, sequentially, it clocked a marginal 1% improvement in revenue from ₹10,791 crore, due to higher average revenue per user (Arpu).
The company’s Arpu rose to ₹121 in the three months ended December from ₹119 in the September quarter. It had reported revenue of ₹109 in the year-ago period.
“Revenue is up 1% QoQ (quarter-on-quarter), supported by improving subscriber mix with higher 4G additions. Superior network performance and launch of unified brand Vi helped in improving subscriber retention,” the company said.
In September, the company had announced the launched of the unified brand Vi, over two years after the merger of erstwhile Vodafone India Ltd and Idea Cellular Ltd in August 2018. Till the brand integration, the two companies catered to different sets of customers, with Vodafone‘s premium appeal and Idea largely serving the rural user base.
In the December quarter, Vi’s 4G subscriber base expanded to 109.7 million from 106.1 million in July-September and 104.2 million in the year-ago. Re-farming of 2G and 3G spectrum to 4G and upgrading network to 4G also supported customer additions, the company said.
“We continue to invest in 4G to increase our coverage and capacity. We have also started to actively upgrade our 3G network to 4G. During the quarter, we added about 12,000 4G sites primarily through re-farming of 2G/3G spectrum to expand our 4G capacity,” it added.
Vi aims to achieve an annual cost savings target of ₹4,000 crore by the end of 2021. It has achieved around 50% of annual savings by the end of Q3FY2, it said. “We remain focused on executing our strategy, and our cost optimisation plan remains on track to deliver the targeted savings,” said Ravinder Takkar, managing director and chief executive, Vi.
Cost optimization measures, incremental savings on operating expenditure and higher revenue led to improved earnings before interest, tax, depreciation and amortisation (Ebitda) of ₹4,286 crore during the quarter, from ₹3,421crore in the year ago, and ₹4,152 in July-September. Ebitda margin was up at 39.3% in Q3 versus 30.8% a year ago and 38.5% in the second quarter of FY21.
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