Vodafone Idea’s consolidated net loss widened to Rs 7,230.9 crore in Q3FY22 even as revenues rose 3.3 percent sequentially
Shares of Vodafone Idea fell as much as 5 percent in early trade on January 24 after analysts were disappointed by the company’s earnings performance for the quarter ended December.
At 10:00 am, the scrip traded at Rs 11.40 apiece on the BSE, while the benchmark Sensex was at 58,608.22, down 428.96 points or 0.73%.
Vodafone Idea’s consolidated net loss widened to Rs 7,230.9 crore in Q3FY22 even as revenues rose 3.3 percent sequentially.
That said, operational performance of the company was weak in the reported quarter. Consolidated operating profit of the company declined 1.2 percent on a quarter-on-quarter basis to Rs 3,816.5 crore despite the company undertaking tariff hikes in the quarter.
Brokerage firm Nomura Securities India said that the operating profit of Vodafone Idea was 4-5 percent below its own and Street’s estimate due higher access charges and higher marketing, content and subscriber acquisition costs.
In the reported quarter, Vodafone Idea’s consolidated operating margin, too, shrank 180 basis points on year to 39.3 percent as against Nomura India’s expectation of 41.4 percent.
Not only the operating performance, the company’s subscriber base also deteriorated in the quarter. The subscriber base fell by 5.8 million to 247.2 million in the quarter, higher than 5 million decline analysts’ had penciled in.
Nomura India was concerned by the increase in the churn in subscriber base of the company to 3.4 percent as against 2.9 percent in the previous quarter. Given the weakness in earnings, Nomura India retained its ‘reduce’ rating on the stock and price target of Rs 8 apiece.
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