Vodafone has clocked revenues of Rs 7850 crore in the quarter ending June 2011, according to TRAI data. This represents a dip in revenues of around 2 percent, as compared to revenues of Rs 7,999 crore for the quarter ending March 2011.
This is despite the group’s reporting 26 million data subscribers that include over two million 3G subscribers at the end of June 2011. After Idea Cellular, this figure represents the fastest 3G uptake in the country. Vodafone was also the second-highest gainer in MNP, after Idea Cellular, adding 6,33,589 new customers, at the end of May 2011. As per TRAI data, the operator added 24.47 lakh customers in May 2011, bringing its total subscriber base to 13.94 crore at the end of May, with a 16.59 percent share of the Indian wireless market. In its official announcement, Vodafone, which had reported mixed results worldwide, said that its profits were led by India and Africa.
However, like all other wireless operators in India, Vodafone Essar has also been experiencing stiff competition from a saturated playing field, falling ARPUs and cut-throat tariffs, worsened by the introduction of per-second billing last year. Earlier this month, Vodafone became the third operator, after TTSL and Bharti Airtel to raise its prepaid tariffs by 20 percent, in a bid to arrest falling ARPUs and straighten out profit margins.
A couple of months ago, Essar Telecom – an arm of the Ruia-led Essar Group saw a mass exodus of top-level employees, following the stake deal closure between Vodafone Group and its Indian partner Essar, which saw the latter surrender all operational rights to the British major in exchange for a sum of $5.46 billion. The British telecom major is now looking for a suitable Indian partner to take the place of Essar, whose stake ceases to exist in the joint venture from February 15, 2012. Ajay Piramal has already bought a 5.5 percent stake in the venture for $640 million, however Vodafone still needs investors for the remaining 27.5 percent Indian stake-holding that is required for it to continue its operations in India.
Essar’s name has also featured in the 2G spectrum scam, although its participation in the biggest scam in India has not been proven yet. Vodafone, which was to come up with an IPO this year, may postpone the same, unless it is able to find Indian partners to carry on its Indian operations. Besides, Vodafone is also fighting a $2 billion tax-evasion case, for its alleged illegal entry into the Indian telecom sector.
Vodafone’s all-India NLD gross revenues for the quarter ending June 2011, stood at Rs 1027.48 crore, as compared to Rs 1006.29 crore in the last quarter, while its ILD gross revenues stood at Rs 228.02 crore, as compared to Rs 227.69 crore in the quarter ending March 2011. Its ISP gross revenues stood at Rs 5.53 crore in the quarter ending June 2011.
Operators are trying to improve their revenues in India. Broadband and value added services will be one of their focus areas.
By Beryl M
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