Vodafone India reports highest incremental revenue market share amongst operators
Robust growth in service revenues, higher customer base, stable tariff rates and increase in the minutes on the network aided Vodafone India in reporting healthy set of numbers for FY12.
The company is confident of sustained operating performance going ahead as-well with any unfavourable proposal by the government on payable tax acting as the only headwind.
For FY12, the company posted 19.5% increase in the service revenues at Rs 32184 crore. This is in-line with its closest industry peers, Bharti Airtel and Idea Cellular which posted a revenue growth of 20% and 26% respectively. However, on the operating profit margin front, it lagged its smaller peer - Idea.
While Vodafone India's operating profit grew 21.6% to Rs 8549 crore, Idea's grew by more than half times. Bharti, on the other hand, grew just 3.8%.
The company's strong performance during the year came in on the back of healthy operational metrics, sustained momentum in the revenue market share and improved margins. Also, the growth came from mobile operators starting to charge for SMS termination during the second quarter of the financial year.
Holding a revenue market share of 20.6%, Vodafone India is the country's second largest telecom operator by revenue share after Bharti.
Through past three quarters, the company has reported the largest revenue market share growth amongst major operators. As of March 21, 2012 the companys customer base stood at 150.5 million in the country, with data customers totalling to 35.4 million.
However, despite a healthy subscriber addition and higher minutes of usage on the network, the company's average revenue per minute (ARPM) declined since the last quarter. This is similar to what its closest peers - Bharti and Idea reported earlier this month.
Nonetheless, the impact of declining ARPM was offset by increase in the minutes of usage (MoU) to some extent. MoU per subscriber increased nearly 4% during the year. Also, pricing remained stable after a prolonged price war.
Strong performance of Vodafone's Indian operations through quarters has offset the slump in spending in Spain and Italy for the group. The company intends to expand its footprint in India by expanding its reach in the enterprise business space.