Vodafone India saw a significant drop in service revenue over the past fiscal year.
The operator’s total revenue for the year dropped 20.2% year-on-year to €4.67 billion, with the revenue from mobile services falling 22% to €4.31 billion. However, Vodafone India turned a profit of €1.3 billion for the year, following a €4.17 billion loss in fiscal 2017.
Vodafone Group CEO Vittorio Colao attributed the drop to “intense competition from the new entrant, aggressive competitor responses and a significant reduction in mobile terminations rates”. Data prices dropped by 86% year-on-year as operators struggled to match Reliance Jio’s heavily discounted rates, while new domestic and international termination rates saw voice tariffs plunge by 40%.
Colao, who has announced that he will leave his position on 1st October, noted that Vodafone’s measures to reduce its operating costs were in part making up for lost revenue. He also commended the company’s efforts in obtaining approvals for its impending merger with Idea Cellular, which is expected to close next month.
“[Vodafone] appointed the new management team, who will focus immediately on capturing the sizeable cost synergies. In addition, we agreed the merger of Indus Towers and Bharti Infratel, allowing Vodafone to own a significant co-controlling stake in India’s largest listed tower company,” said Colao.
Over the past fiscal year, Vodafone India has seen its average data usage increase six-fold year-on-year to 3.5GB per month, and has added 10.2 million subscribers to reach a total of 223 million. It also deployed 48,500 mobile sites to boost its capacity for data traffic.