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Won't shy away from rate hike, may be first to increase prices: Vodafone Idea CEO Ravinder Takkar

Recently, rival firm Bharti Airtel's CEO Gopal Vittal also stated that the current rates for voice and data services are unsustainable

twitter-logoBusinessToday.In | October 31, 2020 | Updated 16:36 IST
Won't shy away from rate hike, may be first to increase prices: Vodafone Idea CEO Ravinder Takkar
Vodafone Idea's CEO Ravinder Takkar

Vodafone Idea's CEO Ravinder Takkar said that the telco will not shy away from raising prices and could be the first among the country's three of the  argest private telecom players to hike prices of voice and data services. Takkar added that the telecom major will not shy away from raising prices and setting a precedent for the industry.

Recently, rival firm Bharti Airtel's CEO Gopal Vittal also stated that the current rates for voice and data services are unsustainable. While Vodafone Idea's second-quarter loss narrowed to Rs 7,218 crore, its operational performance was weaker compared to its peers.

The pending Rs 58,000-crore adjusted gross revenue (AGR) dues and the refinancing of bank guarantees remain a concern to the telco.

Takkar, in the company's post-earnings call with analysts, said the current price levels for voice and data services are unsustainable. The sector requires an average revenue per user (ARPU) of Rs 200 in the short run and Rs 300 eventually, he added.

"If you look at the current pricing, there is something wrong with it...We have said before that we will not shy away from hiking prices and we will be happy to be the first one to do so. We hope others in the industry will follow," Takkar said.

Previously, the company raised prices of voice and data services in December 2019. Vodafone Idea reported a blended ARPU of Rs 119 in Q2FY21, higher than Rs 104 in the same period last year.

Akshaya Moondra, Chief Financial Officer (CFO), said the company had received Rs 2,000 crore from Vodafone Plc and likely to get another Rs 6,400 crore from the UK parent company.

Vodafone Idea, in its post-earnings call, said, "The cumulative amount paid by us till date exceeds 10 per cent of the total liability and accordingly, we believe, the next instalment would be payable only by March 31, 2022."

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