Vodafone Idea Q4FY19 Result: This minimum recharge drove telco's average daily revenue - Here's how

While presenting their financial performance for Q4FY19, Vodafone Idea narrowed its net losses on a quarterly basis while improving their revenue. But what was interesting to know is that the company saw uptick in their revenue due to their introduction of service validity vouchers. This supported Vodafone Idea in their average daily revenue (ADR) after decline in past 11 quarters. Consolidated revenue in Q4FY19 came in at Rs 11,775 crore versus Rs 11,764.8 crore in Q3FY19, but was way higher as against revenue of Rs 6,387.7 crore in Q4FY18. ADR in Q4FY19, grew by 2.3% on a quarterly basis after witnessing successive declines for the 11 prior quarters. 

In its financial audit report, Vodafone Idea says, "We introduced 'service validity vouchers' on a national basis during Q3, which required customers to make a minimum recharge of Rs 35 (28 days validity)."

This resulted in a decline of 53.2 million subscribers as 'Incoming only' or 'Low ARPU; customers migrated their spending from multiple SIMs to single SIM taking the overall subscriber base to 334.1 million.

For this, Vodafone Idea highlights that, the voucher in return resulted in QoQ increase in ADR despite the decline in subscriber numbers. Consequently, ARPU for the quarter surged by 16.3% qoq t Rs 104 compared to Rs 89 in previous quarter. 

Further, in Q4FY19, the company added 5.4 million 4G customers, taking the overall 4G subscribers base to 80.7 million. Meanwhile, broadband subscriber base stood at 110.2 million in Q4. 

Also, total data volumes increased by 95 to 2,947 billion MB compared to last quarter, and average daily data volume increased by 11.4% to 32.7 billion MB in Q4 versus 29.4 billion MB in Q3. 

Finally, total minutes on the network declined by 1.3% during the quarter due to reduction in incoming minutes following disconnection of incoming only or low ARPU customers.