Vodafone Idea rises as Q2 net loss narrows to Rs 7,176 crore

Vodafone Idea gained 2.99% to Rs 7.59 after the telecom service provider's consolidated net loss narrowed to Rs 7,175.9 crore in Q2 FY25 as compared with Rs 8,737.9 crore reported in Q2 FY24.

Revenue from operations rose 2.01% year on year (YoY) to Rs 10,932.2 crore in the quarter ended 30 September 2024.

The company reported a pre-tax loss of Rs 7,168.1 crore in second quarter of FY25 as against a pre-tax loss of Rs 7,920.2 crore posted in same quarter previous fiscal.

EBITDA for the quarter was at Rs 4,549.8 crore, up 6.23% from Rs 4,282.8 crore recorded in Q2 FY24. EBITDA margin improved to 41.6% in September 2024 quarter as compared to 40% registered in the same period a year ago.

The telecom operator said that the subscriber base, including 4G subscriber, was impacted by the recent tariff hikes. The 4G subscriber base stood at 125.9 million at the end of Q2 FY25 compared with 126.7 million in Q2 FY24. The total subscriber base stood at 205 million during the quarter as against 219.8 million in similar quarter last year.

Average revenue per user (ARPU) improved to Rs 156, up 9.86% on YoY basis as against Rs 142 in Q1 FY24.

Capex spend for the quarter stood at Rs 136 crore. The debt from banks and financial institutions reduced by Rs 4,580 crore during the last one year (was at Rs 7,830 crore in Q2 FY24) and stood at Rs 3,250 crore. The cash and bank balance stood at Rs 13,620 crore as of 30 September 2024.

The payment obligations to the Government stood at Rs 2,12,260 crore as of 30 September 2024 including deferred spectrum payment obligations of Rs 1,41,940 crore and AGR liability of Rs 70,320 crore.

Akshaya Moondra, CEO of Vodafone Idea, said, Post the recent equity raise, we are in the process of expanding our 4G coverage and capacity as well as launch of 5G services. Some capex has already been ordered and under execution, basis which we expect approximately 15% increase in our data capacity and an increase in 4G population coverage by around 16 million by end September 24.

Our current capex needs are being met out of equity funds. We are engaged with our lenders for tying up debt funding towards the execution of our network expansion with a planned capex of Rs 500 to 550 billion over next 3 years. The recent tariff intervention is a step in the right direction for the industry to move towards better return on investment, as also to improve cash generation to support the large investment requirements. However, further tariff rationalization is needed for the industry to fully cover its cost of capital.

Vodafone Idea is an Aditya Birla Group and Vodafone Group partnership. It is amongst India's leading telecom service provider. The company provides pan India voice and data services across 2G, 3G and 4G platforms. The company holds large spectrum portfolio including mid band 5G spectrum in 17 circles and mmWave 5G spectrum in 16 circles.

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