Vodafone records lower revenues in 1H18

Dragged down by competition and seasonality in the telecom sector, Vodafone India's service revenues fell 15.8 per cent to rs19,002 crore during the first six months the financial year ended 30 September. In comparison, the company posted Rs22,579 crore during the April-September period of the previous financial year.

During the reporting period, the mobile services providers EBITDA or operating profits plummeted 39.2 per cent to Rs4,075 crore, compared with Rs6,704 crore recorded during the year-ago period. EBITDA margins also fell to 21.4 per cent from 29.6 per cent in H1 of FY17.

Vodafone India, India's second-largest mobile operator and a wholly-owned subsidiary of UK's Vodafone Plc, blamed continued price competition from a new operator RJio and incumbents, seasonality and GST for the decline in service revenues and EBITDA.

''We see signs of positive developments with consolidation of smaller operators. We remain committed to playing our due role in enabling Digital India by fulfilling the evolving needs of increasing volumes, speed and connectivity solutions from both retail and enterprise customers,'' Vodafone India Managing Director and CEO Sunil Sood said in a statement.

The company had increased its customer base by 3.3 per cent to 207 million and recorded an increase of 600 basis points in its revenue market share to 23.1 per cent in the quarter ended 30 June.

For the second quarter ended September 30, Vodafone India's service average revenue per user (ARPU), a key financial metric, stood at 146, still being impacted by ''stiff price competition''. The company's data usage grew by about 250 per cent in the second quarter.

''In India competition remains intense. There are however signs of positive developments in the Indian market, with consolidation of smaller operators and recent price increases from the new entrant. We are making good progress in securing regulatory approvals for our merger with Idea Cellular and in monetising our tower assets,'' Vittorio Colao, Group Chief Executive, said.

STAKE SALE IN INDUS
The company is open to exploring opportunities for sale of stake in independent tower company Indus Towers, which is three-way joint venture among Vodafone India, Bharti Airtel and Idea Cellular.

''We will explore strategic options including the full or partial sales of our 42 per cent stake in Indus Towers, which could create further value for the group...,'' Vodafone Group chief executive Vittorio Colao said during an analyst and investor call.

Vodafone India has a net debt of $8.2 billion.