Vodafone Idea nearing it's inevitable end?
Vodafone Idea is one of the Big 3 telcos in India, but is it losing its ground? The telecom is struggling to survive as we must ask ourselves, is it close to it's end?
Several factors and events have led us to raise such a controversial question:
o The telecom's balance sheet is a mess. As on 30th September, 2022, the telecom's balance sheet held current liabilities worth over Rs 60,000 crores against current assets of only around Rs 15,000 crores!!
o Its operations are bleeding cash. For the quarter ended in September 2022, the company reported a net loss of Rs 7,596 crores, registering a 6.5% spike in losses!!
o The company is falling out of the race of the Big 3 telcos. In Oct 2022, the company lost 3.5 million customers! This was the company's 12th consecutive month of subscriber churn as it's market share has fallen below 21.5%!!
o It is in dire need of parent support. Vi needs an absurd amount of funds to turn around it current situation, but the same isn't available to it. Reports have suggested that the company's promoters are hesitant to infuse more funds!
o It has a hostile external environment. Indus Towers has once again threatened cessation of services if the company fails to clear it's Rs 7,000 crore debt! Vi has called for assistance from banks, but the same seems unlikely.
o It is losing competence. While Jio and Airtel have already launched their 5G services and set up thousands of 5G base stations, Vi is yet to set up a single one!!!!!
o The stock of the company continues to scare people off. The scrip lost over 40% in 2022 and declined 8.9% in 2023 already!!
o Finally, it's own people are starting to lose confidence in the company. Reports have suggested that 20% of the telecom's sales team quit the company in a few weeks, resulting in a 35% loss of workforce over 4 years!!
Vodafone Idea is trying it's best to be relevant as it is introducing new subscription plans and actively seeking partnerships, but is it enough for a turnaround?
Can Vi revive itself? Or are we looking at the fall of another big name?
Will Airtel and Jio be the only players left standing in the ring? Let us know down below. 🔻🔻
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