New Delhi: Vodafone Idea Limited has secured a contract valued at $3.6 billion (Rs. 300 billion) with Nokia, Ericsson, and Samsung for the provision of network equipment over the forthcoming three years.
This agreement signifies the commencement of the company's three-year capital expenditure strategy, which is set to amount to USD 6.6 billion (Rs. 550 billion), as detailed in its official documentation.
The investment is allocated towards the expansion of Vodafone Idea's 4G subscriber base from 1.03 billion to 1.2 billion, the introduction of 5G services in key markets, and the enhancement of capacity to accommodate the growing demands for data. The filing further mentions that the agreement will facilitate the company's utilization of state-of-the-art equipment to elevate customer experiences.
"The company has maintained its longstanding partnerships with Nokia and Ericsson, while also welcoming Samsung as a new collaborator," the statement read.
Vodafone Idea has indicated that this agreement will empower the company to leverage advanced technology to improve customer satisfaction.
"Furthermore, the knowledge and expertise acquired by these vendors in the Indian market over the past two years will assist the company in devising a more adaptable and modular rollout strategy, tailored to the needs of advanced technologies such as 4G and 5G. The new equipment is expected to offer energy efficiency advantages, thereby reducing operational expenses," the company elaborated.
Vodafone Idea has stated that the supplies from these long-term agreements are anticipated to commence in the forthcoming quarter.
The company's primary objective is to extend 4G coverage to 1.2 billion individuals across India, it has declared.
Following the recent equity infusion of Rs. 240 billion and an additional expenditure of Rs. 35 billion on spectrum acquisition during the June 2024 auction, the company has already executed several "quick win" capital expenditure projects in preparation for these long-term agreements. These quick wins have primarily involved the deployment of additional spectrum at existing sites and the establishment of new ones.
"This has resulted in a 15 percent increase in capacity and an expansion of population coverage by 16 million, which is projected to be achieved by the end of September 2024," it added.
Akshaya Moondra, CEO of Vodafone Idea Limited, has expressed, "We are dedicated to investing in emerging network technologies to deliver an unparalleled experience to our customers. We have initiated the investment cycle and are on the trajectory of VIL 2.0. From this point forward, VIL will embark on a smart turnaround, enabling us to effectively seize the opportunities for growth within the industry. Nokia and Ericsson have been our partners from the outset, and this agreement marks another significant milestone in our enduring relationship. We are also enthusiastic about initiating our partnership with Samsung and look forward to collaborating with all our partners as we transition into the era of 5G."
The company has also highlighted that customer experiences have seen improvements in certain regions where these rollouts have been completed.
