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Business News/ Companies / Company Results/  What to expect from Vodafone Idea’s Q1 earnings
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What to expect from Vodafone Idea’s Q1 earnings

Vodafone Idea’s average revenue per user is expected to improve for the third consecutive quarter
  • Vodafone Idea’s topline has continued to remain under pressure after Jio’s entry in September 2016 brought down tariffs
  • Photo: ReutersPremium
    Photo: Reuters

    Vodafone Idea is expected to narrow its loss in the June quarter as it reaps synergies from the merger of brands Idea and Vodafone completed in August last year in order to survive in an intense telecom battleground where it fights rivals Reliance Jio and Bharti Airtel.

    Vodafone Idea’s average revenue per user (ARPU) is also expected to improve for the third consecutive quarter on the back of minimum monthly recharge plans it rolled out for users in November.

    ARPU is the total revenue of the operator divided by the subscriber base. Vodafone Idea counts only paying users to calculate ARPU.

    The company will announce its earnings for the June quarter later today. Rival Jio posted a net profit of 891 crore, up 45.6% year on year. Airtel will announce its financial results on 1 August.

    Vodafone Idea’s topline has continued to remain under pressure after Jio’s entry in September 2016 brought down tariffs to rock-bottom. However, it is still the largest operator in India, by revenue and by subscriber base.

    Motilal Oswal expects Vodafone Idea to see 6% quarter-on-quarter jump in earnings before interest, tax, depreciation and amortisation (EBITDA) led by synergy gains.

    Vodafone India and Idea Cellular, who had announced their merger in March 2017, completed the exercise in August 2018 and are currently undergoing an integration exercise to create synergies which would bring down costs of operating networks.

    Kotak Institutional Equities expects the company’s average revenue per user to rise to of 114. It was 104 in the March quarter, 89 in the December quarter and 88 in the September quarter. Despite the growth, the company’s ARPU is behind both Airtel and Jio.

    “The company is expected to post a net loss of 4,540 crore," ICICI Securities said in a note dated 8 July.

    Vodafone Idea had incurred a net loss of 4,881.9 crore in the March quarter, down from 5,004.6 crore in the December quarter.


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    Published: 26 Jul 2019, 09:06 AM IST
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