Vodafone Idea can turn things around for good. But it will require a lot of help from outside the company. The telco just needs to get a few things right in the next six months, and it can give serious competition to both Reliance Jio and Bharti Airtel. Here’s the thing though, Vi might not have the kind of time I think it does. But there’s one thing I am sure of - the employees of the company (both in the field and the office) haven’t been working relentlessly just to give up on the telco’s future. They are working to ensure that the telco survive.
If you are thinking about the promoters shying away from contributing more capital wise, it is fairly understandable. There’s no investor in the world who would want to risk their money into a company that’s not doing great and in a market where the conditions are not favourable. Because let’s face it, the Indian telecom market isn’t the best from the perspective of the operators as they have to invest high but get a low return because of cheap data pricing.
Vodafone Idea can benefit a lot if few things go its way.
Vodafone Idea Counting on Government, Tariff Hikes to Lead the Way
Vodafone Idea has a lot of hopes from the government. The government is said to be working on a relief package for the telecom sector. Vi has high hopes that this relief package will be able to alleviate its pain to a certain extent.
Further, the telco further has submitted a review petition at the SC to push for corrections in the adjusted gross revenue (AGR) dues amount. If that goes the telco’s way, it would be a major win for the industry as Airtel is also involved in the matter.
On top of all this, a tariff hike would be a great thing for the telco. It will majorly help with increasing the average revenue per user (ARPU). A higher ARPU with reduced AGR dues and a relief package at the back would allow the telco to find new investors much easily.
There’s one more thing that Vi can do but might be a little hesitant. The telco can invest aggressively in its networks. But again, there’s no cash, and whatever there is, Vi would want to use it carefully because it also has statutory dues that will start becoming payable starting December of 2021.
Vodafone Idea can really turn things around if the telco can focus and bring all of its moves to life. It isn’t too late for the telco yet, and no one can or should write off the company from its books.
