Vodafone Idea descends in seven circles

Due to financial constraints and lesser Capex, Vodafone Idea, which is trailing rivals Reliance Jio and Bharti Airtel, has witnessed its revenue market share (RMS) drop to single digits in 7 of the 22 service areas it operates.

The telco’s revenue market share currently ranges from 1.4 to 9.9% in Karnataka, Bihar, Orissa, Assam, the North-East, Himachal Pradesh, and Jammu & Kashmir, compared to 31.5 to 58.2% for Jio and Bharti.

The adjusted gross revenue (AGR) of the operators is used to compute RMS. According to the most recent statistics provided by the Telecom Regulatory Authority of India (Trai), Jio had an overall RMS of 40.9% at the end of the April-June quarter, followed by Bharti at 35.5% and Vodafone Idea at 17.7%. The remaining six states are C-category circles, except Karnataka, which is a circle in the A category.

According to the data for the quarter ending in April-June, the seven circles contribute 7.9% to Vodafone Idea’s overall AGR. In contrast, Jio and Bharti’s AGRs are respectively contributed by the same circles at 21.9% and 26.7%.

It has stated that for Vodafone Idea’s competitive situation to strengthen, a sizable cash raise and/or a tariff rise will be necessary.

The telco’s 16,130 crores in deferred interest payments have still not been converted into equity by the department of telecommunications (DoT). It is said to have informed the corporation that before the government transforms the technology, 5G services must be launched and investors must sign on. Due to its reliance on the government to convert accrued interest dues into equity, the development has left the telecom operator in a difficult position.

Due to increasing finance costs and network operational expenditures, Vodafone Idea’s net loss for the three months ended in September increased to 7,595.5 crore on a sequential basis. Due to a growth in the number of 4G subscribers and an increase in average consumer spending on the network, consolidated revenues increased by over 2% sequentially to Rs 10,615 crore.