Vodafone Idea slashes Capex as 4G will not cover less-ARPU areas

Vodafone Idea CEO Ravinder Takkar has revealed the operational performance of the telecom operator.
Vodafone Idea 4G networkVodafone Idea’s second quarter revenue dropped 3.8 percent quarter-on-quarter to Rs 108.4 billion due to seasonality and by severe floods in many of major markets.  Vodafone Idea ARPU for Q2 was Rs 107 vs Rs 108 in Q1FY20.


Vodafone Idea has decided to slash its Capex to nearly Rs 130 billion from Rs 170 billion for fiscal 2019-20, primarily due to savings resulting from better pricing, disaggregation of components while ordering and reduction in planned 4G footprint in non-priority areas.

Lower than expected capacity requirement during the year has also resulted in Capex deferral to fiscal 2021. Capex spend in second quarter was Rs 21.4 billion.

Vodafone Idea is in the process of re-farming 3G spectrum for offering 4G services along with network integration.

Vodafone Idea completed network integration in 14 service areas with Orissa, Karnataka, Rajasthan and Kolkata integrated during Q2. It already completed network integration in 78 percent of districts.

The improved coverage and capacity following integration, coupled with the deployment of TDD sites, Massive MIMO and LTE 900 MHz on select sites, improved data speeds across circles. The data capacity in the 14 integrated circles has doubled compared to September, 2018.

Vodafone Idea delivers the fastest 4G network speeds in telecom circles of Delhi, Madhya Pradesh and West Bengal as well as in Sikkim and Chennai, based on Ookla data.

Vodafone Idea CEO Ravinder Takkar said: “Data experience for customers has significantly improved post consolidation and we now lead the league tables on 4G data download speeds in the circles of Delhi, Madhya Pradesh, West Bengal as well as in Sikkim and Chennai.”

Vodafone Idea, as part of network integration, had removed surplus equipment from ~50,000 sites out of the total ~73,000 co-located sites. Vodafone Idea exited ~16,000 low utilization sites.

Vodafone Idea’s subscriber base dropped to 311.1 million from 320 million in Q1. Subscriber churn improved, reaching 3.5 percent compared to 3.7 percent in Q1FY20 and 7.2 percent in Q4FY19.

Vodafone Idea added ~12,000 4G FDD sites to increase 4G coverage, and deployed ~6,000 TDD sites in addition to deployment of Massive MIMO in key circles to increase network capacity.

Vodafone Idea has 405,346 broadband sites in Q2 compared to 392,747 in Q1. 4G population coverage reached ~72.2 percent as of September 30, 2019, compared to less than 50 percent for each of the brand at the start of the operations.

Vodafone Idea has added 5.5 million 4G customers vs 4.1 million in first quarter. Vodafone Idea’s 4G subscriber base reached 90.3 million. Total data volumes grew 8.4 percent to 3,492 billion MB compared to the last quarter.

Total minutes on the mobile network declined 6.7 percent during the quarter, primarily due to a reduction in incoming minutes, Vodafone Idea said.