Vodafone India posted its first net profit since starting telecom business in the country in 2007.
For the full year ended March 2014, operating profit for the local unit of United Kingdom’s Vodafone Group Plc grew 26% on year to US $2.277 Billion (Rs 133.986 Billion), according to an Economic Times report Wednesday.
The telecom operator didn’t specify the net profit number for the 2013-14 fiscal year.
India’s No. 2 carrier benefited from reduced competition in fiscal 2014 which allowed it to cut discounts and raise effective call rates while data usage surged, underlining a broad recovery in the beleaguered telecom sector.
On an organic basis, India service revenue increased 13% to $6.391 Billion (Rs 376.06 Billion), “as the growing customer base used greater quantities of voice,” Vodafone said in a statement.
Organic service revenue strips out items such as handset sales, currency movements and acquisitions.
Vodafone India was the leading market for the Group by organic growth during the year, even as its European business declined 9.1%, dragging overall Group revenue down 4.3%.
Vodafone India MD & CEO Marten Pieters said, “We have turned net profitable for the first time indeed.”
He flagged issues such as high taxes and levies on airwaves, scarce 3G spectrum and unfavourable Mergers and Acquisition rules as impediments to industry growth
He hoped India’s next federal government led by Narendra Modi’s Bharatiya Janata Party would improve “investor sentiment” by bringing in stable and rational tax policies.
Vodafone entered India in 2007 after buying out the stake of Hutchison Whampoa.