Vodafone India, the second largest telecom operator in the country, has recorded a 5% increase in service revenues at ?1,039 million (R7,518.2 crore) in the June 2011 quarter from ?988 million (R7,149.1 crore) in the March 2011 quarter.
Revenues of the unlisted company jumped 9% when compared to the June 2010 quarter, when it stood at ?954 million (R 6903.1 crore).
?Service revenues grew due to a 29.8% increase in the customer base, stabilising mobile voice pricing in the market and 70.4% growth in data revenue,? said Vodafone Group in its financial report. During the June 30, 2011 quarter, Vodafone added 7 million new customers to take its total subscriber base to 141.5 million.
According to experts tracking the sector, Vodafone results are in line with industry estimates. Analysts had predicted a revenue growth of 3-6% q-o-q for the June 2011 quarter due to expected increase in the minutes of usage and increased subscriber base. However, companies? bottom lines will continue to be under pressure and would decline substantially as operators have completed 3G rollout and would start charging interest cost and amortisation to P&L. As on June 30, data customers totaled 26 million. The growth was driven by increase in data-enabled handsets and the continued impact of successful marketing campaigns run in conjunction with the sponsorship of key sporting events.
While competition in the market remains high, the effective rate per minute is stabilising as a result of a focus on promotional offers rather than further ongoing price reductions. Vodafone has 95.4% prepaid subscribers with a quarterly churn of 57.1%, up from 50.9% in the March 2011 quarter. Total minutes on its network increased 7% on a sequential basis to 1,27,626 million minutes. Vodafone’s blended average revenue per user (Arpu) has dropped 1.16% sequentially to R169 from R171 in March 2011 quarter.
Following the launch of commercial 3G services in February 2011, 3G was available to Vodafone customers in 147 towns and cities across 12 circles at 30 June 2011.
During the quarter, Vodafone Group paid $3.3 billion (R14,850 crore) for the 22% stake in Vodafone-Essar held by Essar Communications (ECL) and Essar Com (ECom) after withholding tax of $0.9 billion (R4,050 crore). The transfer of these shares from ECL and ECom to Vodafone was completed in two tranches on June 1, 2011, and July 1, 2011. A payment of $1.3 billion (R5,850 crore) relating to the remaining 11% stake in VEL held by Essar Communications Holding (ECHL) and the settlement of all shareholder claims, will be made by February 15, 2012. It is expected that at least 1.35% of the shares in VEL will be transferred to an Indian investor to ensure Vodafone?s continued compliance with Indian foreign direct investment rules.
