Technology News Desk !!! Vodafone Idea Limited (VIL) is not doing anything special for its 5G network. The investment in 5G seems to have been done to avoid losing customers rather than building a better quality network. BofA Securities has given this information in a report. VIL bid for 5G spectrum in the 3300MHz/26GHz band in 17/16 circles out of the lowest 22 circles. Given VIL’s weak balance sheet, BofA Securities believes that in the medium term, VIL may suffer due to lack of adequate spectrum in the 5G space as compared to Bharti/Jio. It further added, “We are also seeing its 5G bid as a marketing gimmick, investing more in deterring customers than in building a better quality network.”
If other telcos have better 5G networks, we would see the company at maximum risk of losing its high-end subscriptions over time, the report said. Nomura said in a report that external fund raising is important for Vodafone Idea for 5G rollout/market share defence. Nomura said Vi spent Rs 188 billion in the recent spectrum auction to get 5G spectrum in its priority circles. While Vii’s current cash EBITDA run-rate (Rs 84 billion) is insufficient to meaningfully increase capex, large upcoming debt repayments (Rs 70 billion) and delays in external fund raising also make us believe that Vi’s 5G Rollouts will remain constrained in the near term. The implementation of 5G rollouts by other operators could make it difficult for Vi to maintain market share.
Vodafone Idea’s EBITDA, though rising, we believe will require the company to meet its repayment obligations, Goldman Sachs said in a report. We anticipate a cash deficit of Rs 40 billion for Vodafone Idea by June 2023. With the subscriber base continuing to decline and Vodafone Idea’s ability to meaningfully increase capex with weak FCF and balance sheet profile, we expect further exposure to the company’s market share. Credit Suisse said in a report, “Based on April/May-22 TRAI numbers and 3.4 million net subscriber loss in Q1 2023, we estimate VIL to have lost 11 lakh customers in June 2022, up from 1 million in May,” Credit Suisse said in a report. is more than 8 lakhs.
Vodafone Idea in a statement after the spectrum auction said, “We actively participated in spectrum auction to strengthen our pan-India 4G footprint and begin our 5G roll-out journey in the country in line with our long-term vision.” We have successfully acquired mid-band 5G spectrum (3300 MHz band) in 17 of our priority circles and mmWave 5G spectrum (26 GHz band) in 16 circles, enabling us to provide a superior 5G experience to our customers as well as our customers. will enable the enterprise to be strengthened.
The acquisition of additional 4G spectrum in three circles of Andhra Pradesh, Karnataka and Punjab will further improve the customer experience. One area where we have been consistently leading the league table for the past several quarters as per third party reports. We believe that the above spectrum acquisition will help us consolidate our position in our key markets and will align well with our long-term strategic intent. With this, we now have a solid portfolio of spectrum across all bands across all our priority circles, the company said. We also benefit from leveraging Vodafone Group’s global experience, which has proven expertise in deploying 5G in multiple markets. We will continue to invest in our future-ready network to upgrade it to roll out 5G services for our customers in the future.
Mobile News Desk !!!