Indebted Vodafone Idea expects higher pricing for 5G and more data bundled with plans than its current 4G service, a senior company official said on Thursday. Vodafone Idea (VIL) managing director and CEO Ravinder said on the earnings call that the company spent a lot of money in the recent auction to acquire spectrum, which requires a premium for 5G services.

It expects overall tariffs for mobile phone services to by the end of the year.

“We think 5G should be priced higher than 4G given the considerable amount of money being spent on spectrum. You can price it higher, but of course within that premium, you might be in a situation where, given what you get in 5G, The extra bandwidth, you get more gigabytes because you might consume more,” said.

The increase in data consumption on 5G networks will depend on the use cases developed and adopted by consumers, he added.

Vodafone Idea gets Rs worth of spectrum. 188 million, including mid-band (3300 MHz band) airwaves in 17 priority circles and 26 GHz band spectrum in 16 5G service circles. The company has also secured additional 4G spectrum in three circles in Andhra Pradesh, Karnataka and Punjab.

The new spectrum tender increases the annual instalment liability of Rs. 16.8 million companies.

VIL has narrowed its consolidated loss slightly to Rs. The June quarter was at Rs 7,296.7 crore compared to the same period last year as tariff hikes boosted its realization. The telco lost Rs. The same period last year was 73.191 billion.

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VIL’s operating income grew to around Rs. Rs 10,410 crore for the quarter ended June 30, 2022, up nearly 14% year-on-year.

Its average revenue per user or ARPU, a key monitoring metric for telecom operators, is Rs. 128 per subscriber for the quarter compared to Rs. 104 in Q1 FY22. That was a 23.4% increase a year earlier, helped by higher tariffs.

“To wrap up, in terms of 4G pricing, I think there’s definitely an opportunity, based on the value that continues to be offered to consumers and how seamlessly the first few price hikes are absorbed, I think there’s an opportunity to do that as soon as possible,” said.

He also said that investments in the company’s network have suffered due to liquidity issues.

Akshaya Moondra, chief financial officer of VIL, said the company has strategically bid for spectrum and its ongoing fundraising plan includes calculating capital expenditures for the 5G network.

The heavily indebted company said its fundraising campaign has seen positive momentum due to the promoter’s recent investment in the company.

At the end of the April-June quarter of 2022, VIL’s total debt, excluding lease liabilities, including accrued but outstanding interest, was Rs. Rs 1,99,080 crore including delayed spectrum payment obligations. Rs 1,16,600 crore, AGR liability. Rs 67,270 crore payable to the government, as well as debts banks and financial institutions. 152 million.

Moondra said the company has paid off a significant amount of its bank debt and the Department of Telecommunications (DoT) has refunded bank guarantees worth Rs. 170 million.

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“We approached the banks and our exposure has come down. Looking at our external debt and EBITDA, we are in a very comfortable position. Government debt has quite a long moratorium period. The banks understand that and based on our relationship with them discussions and we should be able to come to a conclusion in the near future. We will mainly invest in new debt,” he said.

Talking about the conversion of the interest into equity distribution by the government, Moondra said the company has confirmed an amount of Rs 1. Rs 16,130 crore for DoT and awaiting final confirmation the department in this regard.

Once the conversion of the equity into equity is confirmed, the government is expected to receive about 33% of VIL.