For the three months ended September 30, the combined after-tax loss increased to Rs.75.96 billion (US$916.14 million) from Rs.71.32 billion a year earlier. Analysts predicted the company would lose Rs.69.25 billion.
According to Vodafone Idea, the customer base fell to 234.4 million from 240.4 million in the first quarter, while total spending rose 10% to Rs 183.02 billion.
However, thanks to tariff increases, average revenue per user (ARPU), a key performance metric for telecom companies, rose 19.5% to Rs.131. ARPU for the previous quarter was Rs.128.
Reliance Jio and Bharti Airtel, two larger competitors, have quarterly ARPUs of Rs.177.2 and Rs.190, respectively.
To weather Reliance Jio’s price war, which severely affected the domestic telecom business, Vodafone Idea, a merger between Aditya Birla Group’s Idea Cellular and the Indian division of Vodafone Group, was formed in 2018.
Since then, however, Vodafone Idea has suffered losses as customers have flocked to its larger competitors. Due to its high government debt and spectrum fees, it was unable to secure a financing agreement.
Chief Executive Akshaya Moondra said in a statement that the company is continuing discussions with lenders and investors to raise funds for network development and 5G implementation. At the end of September, the company had net debt of Rs. 2.2 trillion. Operating income rose 12.8% to Rs.106.15 billion.
The conversion of interest on outstanding debt into equity was approved by Vodafone Idea’s board of directors following the government’s announcement in January of a support package for the industry. After the conversion, the government will own 35.8% of the company.