Vodafone Idea's Q1 loss narrows to Rs 7,296 cr, appoints Takkar as chairman

Vodafone Idea (Vi) net loss has remained flat year-on-year (YoY) at Rs 7,296 crore in Q1 of FY23 despite 13.7 per cent growth in revenue. In the same period last year, the company had posted a net loss of Rs 7,319 crore.

However, on a sequential basis, the net loss widened by 10.6 per cent. In the fourth quarter of FY22, Vi had posted a net loss of Rs 6,563 crore.

Gross revenue in the first quarter of FY23 increased by 13.7 per cent YoY to Rs 10,410 crore while earnings before interest, tax, depreciation and amortisation (Ebitda) grew 16.7 per cent to Rs 4,328 crore. Operational expenses rose 11.7 per cent YoY to Rs 6,081 crore.

Average revenue per user (ARPU) improved to Rs 128, up 3.2 per cent quarter-on-quarter from Rs 124 in Q4 of FY22. Telecom companies had taken 20 per cent tariff hikes in November 2021.

Ravinder Takkar, MD and CEO of Vi, will take over as chairman from August 19.  He replaces Himanshu Kapania, who stepped down as non-executive chairman of the company on Wednesday. Kapania was appointed non-executive chairman last August. Takkar’s three-year term as MD and CEO ends in August and he is being replaced by chief financial officer (CFO) Akshaya Moondra.

The company lost 3.4 million subscribers sequentially and its user base stood at 240.4 million at the end of the first quarter.

It added 900,000 4G customers and that count stood at 119 million. Data consumption by 4G customers increased sequentially by 3.6 per cent per month to 14.3 GB/month.
 

Vi has been struggling operationally and financially. Previous rating downgrades have resulted in increased finance costs.

Gross debt as of June end stood at Rs 1.99 trillion, comprising deferred spectrum liabilities and bank borrowings.

The promoters — Vodafone Group Plc and Aditya Birla group — have pumped in over Rs 4,900 crore.  However, Vodafone Idea has been unable to raise funds from external investors.

The company management, however, remains confident about its performance and ability to raise funds.

“We continue to witness 4G subscriber growth on the back of superior data and voice experience offered by Vi GIGAnet. This is also because of our focus on creating differentiated digital experiences for our customers. We have acquired sufficient spectrum in our key markets to offer superior 5G experience to our customers. We continue to remain engaged with lenders and investors for further fundraising,” the company’s managing director (MD) and chief executive officer (CEO) Ravinder Takkar said in a statement.

In the recently-concluded auction, Vi acquired mid-band 5G spectrum (3300 MHz band) in its 17 priority circles and mmWave 5G spectrum (26 GHz band) in 16 circles.
 

The company also purchased 4G spectrum in three circles and its total purchase was worth Rs 18,799 crore. Its annual spectrum payout for the latest purchase would be Rs 1,680 crore.