In February, the company added a net of 21,927 users, taking its base to 198.4 million, Trai data showed. The subscriber data includes both mobile users and machine-to-machine (M2M) connections, which are SIM cards used in devices like smart meters and internet of things (IoT) devices.
The marginal improvement can be attributed to the telecom operator’s network expansion for both its 4G and 5G networks.
After a prolonged period of subscriber losses, the modest user additions signal a potential turnaround for the struggling telecom operator. The gain reflects its recent network expansion and government relief on AGR dues, offering hope for improved service quality, cash flows, and a halt to its long decline in the telecom market.
However, its turnaround is also dependent on the potential fundraising. The company also has huge spectrum dues.
Vodafone Idea lost about 85 million subscribers in the last five years. According to Trai data, the company last added mobile users in March 2021 when its subscriber base was 283.7 million. In comparison, Reliance Jio net added 1.6 million users during the month, taking its base to 493.1 million, whereas Airtel net added 4.8 million users, taking its base to 472.6 million, according to Trai data.
BSNL subscriber base was at 92.9 million, with a loss of over 1 lakh subscribers during February. Total wireless (mobile) connections including M2M cellular mobile users was at 1.25 billion as of February end, data showed.
“The AGR (adjusted gross revenue) overhang meant funding was not available. Without funding, investments and deployments suffered. That hurt network experience, impacted brand perception and led to subscriber losses,” Vodafone Idea CEO Abhjit Kishore said during an analyst call in January.
Kishore had said that the AGR issue is now behind and the recent relief from the government is a definitive, conclusive long-term solution, giving a clear visibility to the company’s cash flows. He had added that the company will soon get past negative customer additions.
The Cabinet on 31 December decided to freeze the company’s ₹87,695 in AGR dues as of December-end. After the freeze, the telecom company’s total outgo towards AGR payments over the next six years, from March 2026 to March 2031, would be ₹744 crore, a maximum of ₹124 crore per year. It will also have to pay ₹100 crore annually over four years, from March 2032 to March 2035.
The government had approved a payment plan for the company to clear its frozen AGR dues over FY32-41.
Similarly, the AGR recalculation exercise by the department of telecommunications (DoT) is also going on at the moment.
Over the next three years, Vodafone Idea will be incurring a capital expenditure of ₹45,000 crore. To support the capex plan, the telecom operator is looking to raise ₹25,000 crore in bank funding and ₹10,000 crore in non-funded facilities.
As of December end, the company’s 4G population coverage has increased to 85.5% compared to 77% as of March, 2024, as per its October-December quarter report. In the last 1.5 years to December, the company has spent about ₹18,000 crore to improve its 4G network and roll out 5G.
The company’s average revenue per user (Arpu) was at ₹172 a month as of December end. In comparison, Jio’s Arpu was at ₹213.70, while that of Bharti Airtel was at ₹259.
