Vodafone reels un­der pres­sure from Reliance Jio’s pric­ing

Hindustan Times ST (Jaipur) - - World - Mint Cor­re­spon­dent feed­back@livemint.com

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Vodafone In­dia Ltd, In­dia’s sec­ond-largest telco, on Tues­day said that it has seen de­cline across all key fi­nan­cial pa­ram­e­ters of the com­pany for the April-Septem­ber pe­riod due to con­tin­ued pres­sure from Reliance Jio In­fo­comm Ltd.

The Mum­bai-based com­pany’s ser­vice rev­enue de­clined 15.8% to R19,002 crore; Ebitda (earn­ings be­fore in­ter­est, taxes, de­pre­ci­a­tion and amor­ti­za­tion) de­clined 39.2% to R4,074 crore; and Ebitda mar­gin nar­rowed 8.2 per­cent­age points to 21.4%, even as the com­pany cut down on cap­i­tal ex­pen­di­ture by 13% to R2,915 crore.

In a state­ment, the com­pany blamed “con­tin­ued price com­pe­ti­tion from new op­er­a­tor and in­cum­bents, sea­son­al­ity and GST” re­spon­si­ble for its rev­enues tak­ing a hit.

The num­bers have come in the back­drop of pres­sure eas­ing out on the in­dus­try after Reliance Jio started charg­ing cus­tomers in April; it has in­creased tar­iffs thrice since then, after of­fer­ing ser­vices for free for al­most six months.

How­ever, Vodafone in­creased its cus­tomer base by 3.3% to 207 mil­lion and reg­is­tered an in­crease of 600 ba­sis points in its rev­enue mar­ket share to 23.1% in the quar­ter ended 30 June. How­ever, it said the com­pany’s ser­vice rev­enue Arpu (av­er­age rev­enue per user) took a beat­ing due to stiff price com­pe­ti­tion and it now stands at Rs146 per user.

“We see signs of pos­i­tive de­vel­op­ments with con­sol­i­da­tion of smaller op­er­a­tors,” Su­nil Sood, MD and CEO, said in a state­ment.


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