Vodafone Idea subscribers may have to pay more this year: Here’s why

Vodafone Idea increased its tariffs across the country back in November last year. Now, the telecom operator is planning to go for another round of tariff hikes in India this year. Vodafone Idea CEO Ravinder Takkar while announcing the quarterly revenue for the third quarter of the financial year 2022 said that the company would increase the tariffs for its 4G plans either in 2022 or in 2023.

“It’s possible that there could be another price hike in 2022. Certainly at some point, a price hike will take place. This last one that took place was almost two years later, which I believe is a bit too long. So we certainly would expect less than two years,” Takkar said during the company’s earnings call, as reported by Business Standard.

He also said that the decision whether to increase the tariffs in 2022 or in 2023 will be based on how quickly the existing new tariffs get embedded in the market. “But in 2022, we will have to wait and see how quickly these prices get embedded, probably potentially it (tariff hike) could be in 2023 as well,” he added.

Notably, the decision comes as Vodafone Idea is in need of more capital to strengthen its network and expand its services. For that, the telecom operator is in talks with potential investors. Furthermore, the Vodafone Idea Chief Financial Officer Akshaya Moondra during the earnings call said that the company is expected to save around Rs 1,600 crore annually but not opting to pay the interest of the spectrum acquisition to the government. Instead, it will use these funds to expand its network. Additionally, the government has started the process of releasing Rs 17,000 crore of bank guarantees, all of which are a part of the telecom reform package, that are expected to help the company further.

Separately, Vodafone Idea announced that it lost 5.8 million customers in the third quarter of the 2022 financial year and that its losses widened to 59.5% to Rs 7,230 crore. However, the company’s month-on-month revenue improved by 3.3% and its average revenue per user (ARPU) rose by 5.2% to Rs 115 on a month-on-month basis. In addition to that Vodafone Idea announced that its 4G subscribers increased to 117 million while its average data usage by 4G subscriber declined to 14GB in the past quarter.

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