Vodafone Idea Could Lose High ARPU Customers Because of Delay in 5G Launch: ICICI Direct

Vodafone Idea (Vi) has not yet made any comments on when it is going to launch 5G in India. This delay could cause the company to lose out on high-paying customers. That would be detrimental to the average revenue per user (ARPU) of the telco. Vi’s competitors are rolling out 5G at full flow and plan to offer complete 5G coverage in approximately 1.5 to 2 years. Vodafone Idea’s funding woes have stalled the telco from making moves around 5G. The telco has already done testing of its 5G networks in Delhi and has also demonstrated use cases on its 5G networks at the India Mobile Congress (IMC) 2022.

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According to ICICI Direct, VIL (Vodafone Idea Limited) remains the weakest private telecom company. The telco has a series of debt repayment duties in the near future, and for that, it desperately needs capital. Even though the government has gone ahead with the dues to equity conversion, it only helps the telco in staying afloat and doesn’t guarantee any growth in the short or medium term. For VIL, the quarterly loss widened to Rs 7900 crore, which is approximately $1 billion USD.

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ICICI Direct said, “The delay in 5G launch could further lead to elevated churn in high ARPU and postpaid customer. We highlight that recent government relief measures (including interest on AGR dues moratorium conversion) would ensure survival of VIL but future growth outlook remains gloomy.”