Vodafone Idea (Vi) recently announced its financial results for the fourth quarter of FY22. From the results, it is evident that the company has been adding new 4G users for three consecutive quarters now. This is how the numbers looked for the 4G subscribers of Vodafone Idea (Vi) – a) Q1 FY22 – 112.9 million; b) Q2 FY22 – 116.2 million; c) Q3 FY22 – 117 million; d) Q4 FY22 – 118.1 million. This is a positive development for the telco on the back of a rising ARPU (average revenue per user) figure. Along with this, the average data use by 4G subscribers also grew to 14,195MB in Q4 FY22 from 14,008MB in the preceding quarter. While all of this is good, there are still areas where the telco needs to improve.
Vodafone Idea Losing VLR Subscribers at an Alarming Rate
The telco’s subscriber churn rate hasn’t been good. In the last quarter of FY22, it was 3.4%, the same as the previous quarter. Vi lost 3.4 million active users in Q4 FY22. So even while the ARPU is going up, the more paying customers the telco loses, the lesser the effect of rise in ARPU in general. The telco will have to get aggressive in improving network coverage and capacity to reach or potentially surpass the kind of network experience Reliance Jio and Bharti Airtel offer. The more tariff hikes come, the more will be the expectations from users for a quality mobile calling and internet experience. If Vi is unable to provide that, customers will shift to Jio or Airtel. The ARPU of the telco should rise further in Q1 FY23. A good thing to notice in the results was the narrowing loss for the quarter. Vi had announced a lot of partnerships during FY22. Whether these partnerships will bring any positive change for the telco will be known by the results in the coming quarters.
