Vodafone India April-September quarter profit up 6.7% to Rs 6,534 crore

NEW DELHI: India’s second largest wireless operator by subscribers, Vodafone India reported an operating profit of Rs 6,534 crore for the April-September quarter of this fiscal (2016), a 6.7% increase from the year-ago period.

The company had reported operating profit of Rs 6,121 crore in the same period last fiscal.

The company said that Ebitda margin for the six months was at 29.7%, which is the third largest contributor to company’s revenue. The company has 188 million telecom subscribers in country.

With this, the revenue of the telco rose 11.2% to 22,902 crore for the first half of the fiscal, compared with the Rs.20, 601 crore reported in the same period last year.

The company’s strong operating free cash flow (OFCF) at Rs 2,922 crore for the first half of the fiscal, compared with the Rs 830 crore reported in the same period last year.

“Sustained capital investments of RS 3,627 crore for the first half of the fiscal (16.5% of revenues) driven by significant investments in new site roll-out to deliver superior customer experience and growth in key focus areas,” the company said in its statement.

“We continue to deliver healthy double digit underlying revenue growth of 11.2% and further enhanced EBITDA margin to 29.7%. Driven by the strong uptake in data, our 3G revenues grew 102% YoY. We will launch our 4G services beginning December 2015 in 5 circles that are key to our data revenues and will continue to expand our own 3G coverage to 16 circles across the country,” said Sunil Sood, CEO, Vodafone India.

“A robust and resilient network architecture with strong backhaul is being built to support the increasing volumes and need for speed from both retail and enterprise customers. We remain committed to fulfill the evolving needs of our customers and leverage our global experience plus rich understanding of India to play a meaningful role in enabling Digital India,” he added.

The telecom operator said that its data continues to drive growth, contributing to 18.9% of service revenue (Q2FY16), while enterprise business contributes around 15%.

“Data growth continues to be very strong, with data usage over the network up 74% year-on-year in H1, and the active data customer base increasing 16% to 66.5 million. The 3G customer base grew to 23.8 million, up 75% year-on-year, and smartphone penetration in our four biggest urban areas is 49%,” the operator said.

“Data pricing has recently become competitive after price rises earlier in the year. In Q2, browsing revenue represented 18.9% of local service revenue, up from 13.5% in the equivalent quarter last year,” it said.

Going ahead, the company said that it will launch new 4G services on the superior 1800 MHz band in 5 Circles (Mumbai, Delhi, Kolkata,Kerala and Karnataka) beginning December 2015 .

For the customer benefit  “Offering customers the best offer on iPhone 6s and iPhone 6s Plus with fully built Vodafone RED 1299 plan free for six months from time of purchase, voice and data benefit of Rs 8885,” the company said.

Under the retail expansion, Vodafone India is now amongst the largest retailers in the country with 9,880 branded retail stores, covering over.

Pan-India footprint, largest business correspondent in the country with around 97,000 authorized agents (greaterthan 80% of all bank branches in India), of which 58% are in rural areas (Sept ’15 ex it).

“A base of over 3.9 million registered accounts/customers, doing over 160K transactions per day, Money Transfer transactions contribute over 65% of overall transactions. M-Pesa App with over 300,000 downloads acting as a key business differentiator, to enable convenient payment of bills & recharging on the move,” it said