Higher customer additions and growth in data revenue have helped Vodafone India post a 13 per cent rise in service revenues, at ₹37,606 crore for the financial year ended March 31.
India is now the third largest contributor to Vodafone Group’s service revenues and operating free cash flow, up from fourth place a year ago. India is now behind only theUK and Germany.
The country’s second largest mobile operator by users had posted ₹33,281.80 crore in service revenue during the previous financial year.
The unlisted company’s total revenue rose 13.5 per cent to ₹42,125.30 crore during the year under review from ₹37,129.90 crore recorded in FY13.
“Maintaining our focus on profitable growth has led to significant improvement in operating margins and strong cash flows,” said Vodafone India Managing Director and Chief Executive Officer Marten Pieters.
The company has registered a strong uptake of data, with average revenue per user (ARPU) rising 28 per cent in FY14 to ₹65 (₹51 in FY13) and data revenue growing 72 per cent to ₹3,436.90 crore in FY14.
The GSM operator’s 3G usage has also risen 62 per cent to 679 MB per subscriber in FY14 from 419 MB per user in FY13, Pieters said.
Capex Vodafone has earmarked a capital expenditure of ₹7,000 crore for the next 2-3 years for project-spend, its Chief Financial Officer Thomas Reisten said.
Vodafone, which is facing significant regulatory challenges in the country, said that it will be good if the new Government brings back investment friendly policies.
“It would be really good if the (new) Government, as one of its first things, brings the investor sentiment back saying ‘this is a country where you can rely on a rational tax collection”, Pieters said.
Arbitration The previous UPA Government, in its last Cabinet meeting (on May 15), decided to withdraw the conciliation process with Vodafone over the tax issue.
Vodafone had served a notice for arbitration without waiting for the decision of the Income Tax Appellate Tribunal (ITAT), the Finance Ministry had clarified on May 12.
The Cabinet had, in June 2013, approved a Finance Ministry proposal to go in for conciliation with Vodafone to resolve the capital gains tax dispute related to its acquisition of Hutchison Whampoa’s stake in Hutchison Essar in 2007.
Unjustified claims Pieters said Vodafone has suffered from unjustified tax claims.
“That does not make sense and as we read in newspapers, we are for sure are not the only company that has a problem. I have no sympathy for people (companies) who avoid paying tax, but I also have little sympathy for taxmen, who by using strong arm collect tax without any reason,” he said.