Vodafone Idea losses widen to Rs7,675 crore in Q4

VI Payment obligations to government stood at Rs2,03,430 crore as of March 31, 2024

New Delhi: Debt-ridden telecom operator Vodafone Idea on Thursday reported widening of losses to Rs 7,675 crore in the March quarter amid a rise in interest and financing cost, while its overall subscriber base shrunk.

The company had registered a loss of Rs6,419 crore in the year-ago period.

The consolidated revenue of operations remained almost flat at Rs10,607 crore during the reported quarter.

VIL reported improvements in Average Revenue Per User (ARPU) but its overall subscriber base shrunk both sequentially and year over year.

The interest and finance cost of the company increased by about 27 per cent to Rs6,247.8 crore from Rs4907.8 crore in the corresponding quarter a year ago.

For the year ended March 31, 2024, Vodafone Idea (VIL) posted widening of loss to Rs31,238.4 crore from Rs29,301.1 crore a year ago.

The annual revenue from operations was marginally higher by 1.1 per cent to Rs42,651.7 crore from Rs42,177.2 crore in 2022-23.

“We registered growth in ARPU and 4G subscribers for 11 successive quarters. Our equity fundraise of about Rs215 billion (Rs21,500 crore) will enable us to kickstart the investment cycle to expand our 4G coverage as well as launch 5G services to effectively participate in the industry growth opportunities.

“We are engaged with our lenders for tying up debt funding towards the execution of our overall network expansion plan,” VIL CEO Akshaya Moondra said in a statement.

The company has approval of the board to raise Rs45,000 crore of which it has already raised Rs20,075 crore comprising Rs18,000 crore through follow-on-public offer (FPO) and Rs2,075 crore through preferential equity allotment to an Aditya Birla Group firm.

Aditya Birla Group holds a 17.5 per cent stake in the company, Vodafone Group has 31.4 per cent and the government has 32.2 per cent share in the company.

“Equity funding, debt funding including non-fund based facilities are to be utilised primarily towards capex which is expected to be in the range of Rs 500 to 550 billion over next 3 years. The capex will be towards expanding 4G population coverage in 17 priority circles, 5G launch in key cities and geographies and capacity expansion to address the increasing data demand,” the statement said.

The company’s capex spend for the quarter stood at Rs550 crore, and capex for the year at Rs1850 crore.

VIL said that it is in discussions with a consortium of banks to raise up to Rs25,000 crore and additional non-fund based facilities of up to Rs10,000 crore.

“Post the telecom reforms package in September 2021, our bank exposure has reduced by approximately Rs346 billion (Rs34,600 crore),” the statement said.

The total debt of the company stood at around Rs2,07,630 crore.

“The total debt from banks and financial institutions stood at Rs4,040 crore and Optionally Convertible Debentures at Rs160 crore as of March 31, 2024. The debt from banks and financial institutions reduced by Rs7,090 crore during the last one year. The payment obligations to the government stood at Rs2,03,430 crore as of March 31, 2024, including deferred spectrum payment obligations of Rs1,33,110 crore and AGR liability of Rs70,320 crore,” the statement said.

The total customer base of VIL declined by 5.7 per cent to 21.3 crore from 22.6 crore in the March 2023 quarter. The company reported an increase in the share of post-paid customers of about 1.3 per cent on YoY basis.

The 4G subscriber base of VIL increased to 12.63 crore from 12.26 crore on YoY basis.

The average data consumed by 4G subscribers grew by 2.3 per cent to 15.44 GB.

Average revenue per user (ARPU) of the company grew 7.6 per cent on a year-over-year basis to Rs146. On a sequential basis too, it was higher than Rs145 in the preceding December quarter.

The company has focussed investment towards 17 priority circles as they account for around 98 per cent of its total revenues.

“We have shut down 3G completely in 6 circles with Kerala getting added to the list of 5 other circles; namely Maharashtra, Gujarat, Andhra Pradesh, Mumbai and Kolkata where 3G spectrum is completely refarmed to 4G. Our 4G network covers over 1 billion Indians. We have completed minimum rollout obligations for 5G in 4 circles of Maharashtra, Delhi, Tamil Nadu, and Punjab,” the statement said.