Vodafone sinks as Q1 net loss widens to Rs 7,840 crore

Vodafone Idea Limited shares tanked over 3 percent to Rs 7.8 in early trade on August 16 after the company’s net loss widened 7 percent to Rs 7,840 crore in the April-June quarter.

During the same period last year, the telecom major reported a net loss of Rs 7,297 crore, the company said in an exchange filing on August 14.

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Revenue from operations rose by a marginal 2 percent to Rs 10,655 crore in the first quarter, compared with Rs 10,410 crore in the same quarter of last year.

The financials

The companies average revenue per unit also known as ARPU increased slightly to Rs 139 as against Rs 135 in the previous quarter, showing a sequential growth of 3 percrcent. ARPU is an indicator of the profitability of a product based on the amount of money that is generated from each of its users or subscribers. It is a particularly useful measurement for companies in the telecommunications and media industries, which rely on subscribers or users.

Read more: Vodafone Idea seeks time till December to clear statutory dues

The company has reported an EBITDA of Rs 4,157 crore in the reporting quarter, while margins stood at 39%. EBIT loss for the quarter stood at 1,459 crore.

EBITDA is earnings before interest, tax, depriciation, and amortisation.

“The eighth consecutive quarter of growth in average daily revenue, ARPU and 4G subscribers, clearly reflect our ability to effectively operate and compete in the market,” said Akshaya Moondra, CEO, Vodafone Idea.

Furthermore, the cash-strapped company said that it had received communication from a promoter group entity promising financial support of up to Rs 2,000 crore if required to meet payment obligations.

“The company has received a communication from a promoter group entity confirming that in the event of any fund requirement for meeting its impending payment obligations by the company, it shall provide direct or indirect financial support to the extent of Rs 2,000 crore,” Vodafone Idea said in the filing.

The total gross debt of the company (excluding lease liabilities and including interest accrued but not due) as of June 30, 2023, stood at Rs 2,11,760 crore.

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