scorecardVodafone Idea lost $700 million in 3 months, but its investors lost $200 million in a day
  1. Home
  2. business
  3. Vodafone Idea lost $700 million in 3 months, but its investors lost $200 million in a day

Vodafone Idea lost $700 million in 3 months, but its investors lost $200 million in a day

Vodafone Idea lost $700 million in 3 months, but its investors lost $200 million in a day
Business1 min read
  • Vodafone Idea’s stock crashed by 27% in today’s trade, closing at ₹6.7 per share.
  • As much as ₹1,400 crore, about $200 million, was lost in a single day’s trade.
  • Vodafone Idea posted a net loss of ₹4,874 crore, or over $700 million, in the first quarter of the current financial year.


Vodafone Idea’s stock crashed by a massive 27% in today’s trade, closing at ₹6.7 per share. It means that as much as ₹1,400 crore, about $200 million, was lost in a single day’s trade.


On Friday (July 26), Vodafone Idea posted a net loss of ₹4,874 crore, or over $700 million, in the first quarter of the current financial year.



“Vodafone Idea’s results disappointed with revenues, EBIDTA (pre-tax profits), and a loss ---all missed estimates,” said a report by CLSA, which retained its ‘Sell’ recommendation.



In the long-run

Top telecom operators Vodafone and Idea Cellular had merged last year, and these synergies will start paying off in a year.


“We are delivering on our stated strategy, although the benefits are not yet visible in our top line. We are well on track to deliver our synergy targets by Q1 of 2020-21. We expect these factors to increasingly contribute to our financial performance going forward,” said Balesh Sharma, CEO Vodafone Idea.



But the shareholders were clearly not in the mood to wait so long. The company, in spite of its size, is unable to keep up with competition from Reliance Jio, which has been gaining subscribers at Vodafone Idea’s cost.


Vodafone Idea has been losing in terms of quantity and quality of subscribers as well. Its average revenue per user rose by a mere 4% to ₹108. Added to that, some of its best paying customers also downtraded which means went in for cheaper plans, leaving it with fewer profits.





READ MORE ARTICLES ON




Advertisement