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Voda Idea narrows losses to 6.5k cr in Q4, Arpu hits 124

The carrier increased its 4G subscriber base with 1 million added in the March quarter taking the total 4G base to 118.1 million. (Mint)Premium
The carrier increased its 4G subscriber base with 1 million added in the March quarter taking the total 4G base to 118.1 million. (Mint)

  • The carrier saw sizeable increase in average revenue per user, a key measure of profitability, which rose to Rs124 up from Rs115 on-quarter, which helped in the surge in revenue to Rs10,239 crore in the quarter, up 6.6% on-year than Rs9,717.3 crore in the previous quarter

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India’s third largest carrier Vodafone Idea narrowed its losses to 6,563 crore in the quarter ended March 2022, from 7,230 crore in the previous quarter, and grew its key operating metrics including revenue and margins, on the back of tariff hike in November last year. 

The carrier saw sizeable increase in average revenue per user, a key measure of profitability, which rose to 124 up from 115 on-quarter, which helped in the surge in revenue to 10,239 crore in the quarter, up 6.6% on-year than 9,717.3 crore in the previous quarter. The company noted that average daily revenue for the quarter saw sequential growth of 7.7%, highest since the merger in 2018. 

“We are pleased to announce third consecutive quarter of revenue growth driven by tariff interventions taken in November 2021," said Ravinder Takkar, managing director and chief executive officer of Vodafone Idea on Tuesday. 

“We successfully completed first tranche of fund raising in the form of preferential equity contribution of Rs. 45 billion from our promoters. We continue to actively engage with lenders and investors for further fund raising," he added. 

The carrier told the stock exchanges that the department of telecommunications (DoT) has computed the value of interest liability from deferring payment of spectrum and adjusted gross revenue dues during moratorium period to 16,133 crore which has been accepted by the company, but it’s accounting will be done after shares are issued to the government. 

The Aditya Birla Group promoted telecom services provider had estimated the liability to be about 16,000 crore when it had opted for the conversion to equity in January. 

“The effective date for calculation of the Net Present Value of the interest being converted to equity is January 10, 2022. We have submitted the required information to DoT and conversion process is expected to conclude soon," the carrier said in a statement. 

It added that after the inclusion of preferential allotment of shares to promoter entities for infusing 4,500 croreS into the company, the aggregate shareholding of the promoters – Vodafone Group and Aditya Birla Group – had risen to 74.99% from 72.05%. 

Therefore, the equity holding of the government will reduce after conversion of interest liability during moratorium period to equity, to about 33% versus 36% computed prior, while promoter shareholding will reduce to about 50%, the carrier noted. 

The carrier also received financial bank guarantees amounting to 16,000 crore on March 29, 2022 from DoT. 

For the full year FY22, the losses narrowed sharply to 28,245.4 crore, from 44,233.1 crore in the previous financial year. Revenue from operations for financial year ended March 2022 came in at 38,515.5 crore, lower than 41,592 crore in FY21. 

Net loss for the full year at 28,245 crore was sharply lower – by 36% - than 44,233 crore recorded in the previous financial year. 

Earnings before interest, taxation, depreciation and amortisation (EBITDA) for the quarter was 4649 crore, highest since Q4FY21, driven by improvement in revenue which was partially offset by higher subscriber acquisition costs due to higher gross additions during the quarter. 

The carrier increased its 4G subscriber base with 1 million added in the March quarter taking the total 4G base to 118.1 million. Overall subscriber base declined to 243.8 million, primarily due to tariff increase. 

“This quarter had one-off of 1.5 billion primarily in network & IT costs," the company said. It added that capex spend for the quarter was 1200 crore from 1050 crore in the previous quarter. Total capex spend for FY22 stands at 44,900 crore up from 41,500 crore in FY21.

Cash and cash equivalents were 14,600 crore and net debt was at 1.96 trillion as of March 31, 2022, while gross debt was 1.98 trillion, comprising of deferred spectrum payment obligations of 1.13 trillion, AGR liability of 65,950 crore that are due to the government and debt from banks and financial institutions at 18070 crore.

 

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