Telecom operator Vodafone Idea (Vi) will pursue selective tariff adjustments rather than a broad-based price hike, CEO Abhijit Kishor said, with the move hinting towards the recent pricing actions in the sector as limited to incremental corrections.
“There will be some minor correction here and there, but not a structural tariff hikes as you generally see,” Kishore said while speaking to the press, signalling that the company is not looking at an immediate, across-the-board increase in rates.
The comments come as the focus has renewed on tariff hikes in the telecom sector, especially after recent pricing moves by larger peers. Meanwhile, the remarks suggests a calculated strategy which efforts towards balancing revenue improvement with subscriber retention.
Navigating Competitor Hikes
Bharti Airtel had on Sunday raised the price of its Rs 859 prepaid plan which offers the 84 days validity package with 1.5 GB of data per day, to Rs 899, while discontinuing its Rs 799 plan with 77-day validity, as per to its website. This marks a departure from the usual conduct since the headline tariffs across plans have remained largely unchanged for nearly two years.
Speaking on the government dues, Kishore said the outcome of the ongoing reassessment of adjusted gross revenue (AGR) dues is expected soon. He added that the process is moving at a ‘fast pace’ and that the company expects clarity in the near term, but declined to elaborate further citing the ongoing silent period ahead of results.
The recalculation exercise, being carried out following directions from the Supreme Court, involves a review of licence fee and spectrum usage charge components over past years. The process is underway at the Department of Telecommunications (DoT) and is expected to provide clarity on the company’s liabilities.
Regulatory Clarity
Vi chief executive added that the government remains confident in the company’s operations, a testimony of which is the presence as a significant shareholder.
“The government is a 49% stakeholder and we really value that. We are working towards what we should be doing, which is basically improving the performance, which is what you see on the subscriber initiative. We have reported earlier in the month of February-March, which is out in the public domain,” Kishore said.
The telco is beginning to see improvement in its operating metrics. Recent trends point to a pickup in subscriber additions leading to a shift after a prolonged phase of user losses, the executive indicated.
As per the recent TRAI data, for the second consecutive month, Vi added subscriber, with March additions coming at 1,03,000 (February: 22,000) users to its overall subscriber base.