Vodafone Idea shares rise 6% as EBITDA jumps

Tax expenses of the Mumbai-based company jumped to Rs 1,999.70 crore during December quarter, compared to Rs 45.40 crore in the July-September quarter

New Delhi: A day after reporting a Rs 5,004.60 crore loss for the fiscal quarter ended December 31, Vodafone Idea's shares rose about 6 percent in Thursday's session. The Tax expenses of the Mumbai-based company jumped to Rs 1,999.70 crore during the December quarter, compared to Rs 45.40 crore in the July-September quarter. In Q3FY19, the company's average revenue per user (ARPU) increased to Rs 89, against Rs 88 during the same quarter in the year ago period.

Ammunition is EBITDA

Earnings before interest, tax, depreciation, and amortisation (EBITDA) jumped 16.3 percent to Rs 1,140 crore QoQ. Vodafone Idea's board also approved a rights issue of up to Rs 25,000 crore.

Te company, which merged its Indian operations with Idea Cellular in August last year, recorded a net loss of Rs 50 billion for the December quarter, an exchange filing said on Wednesday. According to data compiled by Bloomberg, Vodafone Idea marginally beat the average estimate by analysts for a US5 1.7 billion-rupee loss. It had posted nearly the same net loss on its debut last quarter.

Subscriber base fell by 9%

The heavy losses point out the continued pain inflicted on telecom operators in the industry after the entry of Reliance Jio Infocomm Ltd started in 2016. The company, owned by Asia's richest man Mukesh Ambani, offered free services that resulted in the merger of rivals to keep up with the market competition.

According to the filing, Vodafone Idea had revenues of Rs 117.6 billion with average revenue per user of 89 rupees. The company's subscriber base fell to 387.2 million from 422.3 million in the preceding quarter.