Vodafone plc CEO Vittorio Colao says India has become its fourth largest business on a telecom service revenue basis.
AMAP region — India is part of this — is the second biggest contributor to Vodafone Group service revenue in the first quarter of fiscal 2014.
Vodafone India on Friday said its revenue increased 13.8 percent to £1.09 billion ($1.66 billion) in Q1 fiscal 2014 from £963 million in the same quarter last fiscal. The growth drivers include stable pricing environment, improved process of customer verification and strong data revenue growth.
“In India we are seeing a much healthier environment enabling us to deliver service revenue growth of 13.8 percent compared to 7.8 percent in the prior quarter. As a result, India on a service revenue basis has become our fourth largest business,” said Vodafone plc CEO Vittorio Colao.
Vodafone CEO noted that smaller operators have scaled back their activities in India. At the same time, Vodafone increased its market share in the Indian mobile service market which is currently dominated by billionaire Sunil Mittal-promoted Bharti Airtel. Its strategies are reflecting in growth.
“We have also seen less price discounting enabling outgoing voice prices to rise in turn driving higher ARPU. Customer growth was strong at 2.7 million, in part due to improved processing of subscriber verification requirements and we continue to attract quality customers shown by an activity ratio of 95 percent,” Colao said.
“We are really beginning to see data take off in India. Data users have grown by 33 percent year-on-year to 41 million. We now have 4 million 3G data users and smartphone penetration is already at 9 percent,” Colao added.
Vodafone’ challenges in India
Despite positive market conditions, Vodafone India continues to face uncertainties on the regulatory front, particularly regarding spectrum pricing and availability. The auction of 1800 and 900 megahertz spectrum may take place later this year.
This apart, Vodafone is still waging a major battle to resolve the tax issue. ( Cabinet approves move to settle Vodafone India tax case )
Other challenges include penalty on account of 3G roaming pact with Airtel and Idea Cellular.
Pix: telegraph.co.uk
But 3G plans are very costly.