Jio effect? Vodafone’s profit dips by 10.2%

Country’s second largest telco Vodafone India reported a 10.2% dip in its FY17 operating profit at Rs 11,784 crore on Tuesday, hurt by aggressive competition.

The company, which is set to be merged with Idea Cellular to create the country’s largest telecom player, had reported an EBITDA profit of Rs 13,115 crore on a standalone basis in the year ago period.

The British telecom major’s overall revenue on a standalone basis slipped 0.6% to Rs 43,095 crore, while the margin contracted by nearly three percentage points to 27.2%.

Vodafone’s Managing Director and Chief Executive Officer Sunil Sood said, “Amidst an unprecedented and intensely competitive environment, we delivered a stable performance.”

He said the company, whose subscriber base grew to 209 million, recorded a 0.7% gain in its revenue market share to 22.7% as of December 2016 quarter. It reported an average revenue per user of Rs 158.

The company invested Rs 8,311 crore during the fiscal and its net debt was Rs 60,200 crore as of March 31.

The entry of Reliance Jio has intensified the competition and hurt the financials of all the incumbents as they seek to protect their customers from moving out.