Voda-Idea posts ₹4,874-crore loss

Our Bureau Mumbai | Updated on July 26, 2019

Revenues fall to ₹11,269 crore; topline yet to reflect synergies, says company

Vodafone Idea Ltd (VIL), the country’s largest mobile operator by users, has posted a consolidated net loss of ₹4,873.9 crore for the first quarter ended June 30, compared with a net profit of ₹256.5 crore recorded during the same year-ago quarter.

Separately, its wholly owned subsidiary Vodafone M-Pesa (VMPL) has decided to shut down its payments bank business.

Vodafone India and Idea Cellular had effected their merger as of August 31, 2018, to form VIL, and hence, the previous year’s figures are not comparable.

In the sequential fourth quarter, the company had posted a net loss of ₹4,881.9 crore. VIL’s revenues fell to ₹11,269.9 crore during the reporting quarter, compared with ₹11,775 crore posted in the fourth quarter, VIL said in a statement.

“We are delivering on our stated strategy, although the benefits are not yet visible in our topline. As we continue to integrate our networks, our customers’ data experience is significantly improving in most service areas and we now lead the league tables on data download speeds in Delhi, West Bengal and Chennai,” said Balesh Sharma, VIL’s CEO.

“We are well on track to deliver our synergy targets by the first quarter of financial year 2021,” he added.

The company attributed the fall in first-quarter revenue primarily to churn of customers who recharged with ‘service validity vouchers’ in Q4, as well as Average Revenue Per User (ARPU) down-trading.

The exceptional items for the June quarter included a ₹3,364.5-crore gain from Idea Cellular Infrastructure Services Ltd.

₹49.6-crore impairment

The group has decided to close its pre-paid instruments (PPI) and banking correspondents business, and is currently exploring other opportunities in VMPL. Following this, the group has recorded an impairment provision amounting to ₹49.6 crore.

On Tuesday, BusinessLine had reported that hit by regulatory curbs and stress in the sector, VMPL has shut down operations in India with effect from July 15. The wholly owned subsidiary has informed the RBI of its plans to surrender the payments bank licence.

It has also received RBI approval to extinguish its liabilities towards PPI holders till September 30, without further loading of balance in wallet, it added.

Aditya Birla Idea Payment Bank Ltd, an associate company, had also decided to wind up business voluntarily on July 19. The group has impaired net investments of ₹159.6 crore.

Published on July 26, 2019

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