India sales bolster Vodafone Plc's quarterly update

UK-listed Vodafone Plc posted an interim management statement for the December quarter, saying it was helped by strong growth in emerging markets such as India, even as its key European business continued to remain sluggish.

The Vodafone Group’s service revenues fell 4.8 percent year-on-year to 9.85 billion euros, thanks to revenue de-growth of 9.6 percent in its European market even as its growth in the Africa, Middle-East and Asia Pacific (AMAP) region, of which India is a part, stood at 5.5 percent.

Europe made up 66 percent of Vodafone’s service revenues while AMAP’s share was 32 percent.

“Our emerging market businesses are growing strongly, supported by consistent execution and accelerating demand for data,” Vittorio Colao, the group’s chief executive said. “In Europe, conditions are still difficult, and we continue to mitigate these challenges through ongoing improvements to our operating model and cost efficiency.”

Vodafone shares were up 1.4 percent in early London trading.

Despite being in the midst of a local consolidation in the wake of high competition and costs, the Indian market was the fastest-growing for Vodafone, reporting a 13.2 percent organic growth, with revenues standing at 937 million euros during the quarter, or Rs 7,917 crore.

“Service revenue [in India] increased 13.2 percent driven by continued customer growth, higher voice usage, improved voice pricing and increased data usage,” Vodafone said.

The telecom major added 4.9 million users, with customer base standing at 160.4 million at the end of the quarter. Data usage jumped a mammoth 117 percent, thanks a 38 percent increase in mobile internet users and a 65 percent rise in usage per customer.

“On 31 December 2013, active data customers totalled 45.7 million, including 5.2 million 3G subscribers,” the company said

Vodafone also said it would follow through on its proposal of buying out its remaining stake in Vodafone India held by Piramal Enterprises and Analjit Singh.

The government had recently given its nod on the issue and the Cabinet is likely to take up the proposal today.

Vodafone also did not carry any provision for litigation for its tax tussle with the Indian government during the quarter.