NEW DELHI: Telecom network operator Vodafone India says its service revenue increased 5 percent to £4,497 million or $6,510 million in fiscal 2016. The growth of Vodafone service revenue was 2.3 percent in Q3 and 5.3 percent in Q4. Growth in mobile customer base and demand for 3G data did not assist Vodafone to achieve strong growth in service revenue in fiscal 2016 ended on March 31.
Revenue of Vodafone in India was affected adversely during the fiscal year by significant regulatory impacts — including MTR cuts, roaming price caps and increase in service tax — and price competition among mobile operators. Excluding these impacts, service revenue growth of Vodafone India was 10 percent. Vodafone India added 14.1 million mobile customers during the year to 197.9 million. Growth in total minutes of use continued. Vodafone India noted a decline in average revenue per minute as a result of ongoing competition on voice business. Data usage of Vodafone India rose 64 percent. Active data customer base increased by 3.8 million to 67.5 million.
The 3G customer base of Vodafone India grew 41.4 percent to 27.4 million. Smartphone penetration in its four biggest urban areas is 52.8 percent. In Q4, browsing revenue represented 19.2 percent of service revenue, up from 14.9 percent in the same quarter last year. Vodafone India added over 37,700 new 3G sites, taking the total to 55,500 and population coverage to 95 percent of target urban areas. The mobile operator launched 4G in five key circles and plan to expand to cover over 60 percent of its data revenues in the coming year, ahead of the upcoming spectrum auction.
Vodafone M-Pesa business has 1.3 million active customers and approximately 120,000 agents. EBITDA of Vodafone India grew 4.1 percent, with a 0.2* percentage point deterioration in EBITDA margin as the benefits of service revenue growth were offset by the ongoing increase in operating costs related to Project Spring, higher acquisition costs and the translation effects of non-rupee operating costs.
Dropped call rates have fallen from 1.3 percent to 0.9 percent. Given the high cost of spectrum, Vodafone India intends to take a disciplined approach to further 4G rollout. The company said Indian telecom market conditions remain competitive and may be further impacted by the forthcoming spectrum auctions and a new entrant (Reliance Jio).
