Cash Flow Analysis of Vodafone Idea Limited (A)
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Case Code: CLFIN039 Case Length: 4 Pages Period: 2018-21 Pub Date: 2023 Teaching Note: Available |
Price: Rs.200 Organization : Vodafone Idea Limited Industry :Technology & Communications Countries : India Themes: Accounting and Control ,Financial Analysis |
Abstract
Vodafone India Limited (VIL) is a leading telecom operator in India. The total revenue of VIL for the financial year 2019-20 was Rs. 459,968 million, and the company incurred a loss of Rs. 234,413 million before considering tax and the exceptional items. The company’s operating expenses were Rs. 300,450 million and it incurred an operating loss before considering tax and exceptional items. The present case study can help in understanding the concept of cash flows and the importance of operating cash flows in determining the operating efficiency of a firm. The nature and classification of operating cash flows of VIL can also be discussed.
Issues
- Understand the concept of cash flows and Cash Equivalents.
- Examine the nature and classification of operating cash flows.
- Detail the process of determining operating cash flows of a company as per Ind AS 7
Introduction
India-based Vodafone Idea Limited (VIL) was formed as a combined entity with the merger of two leading telecom operators in the country, Vodafone India (Vodafone) and Idea Cellular (Idea), in August, 2018. VIL was a leading telecom operator in the country with a subscriber base of 277.62 million as of March 31, 2021. VIL was headed by Kumar Mangalam Birla of the Aditya Birla Group as Chairman and Ravinder Takkar as the CEO.
The merged entity was rebranded as Vi in September 2020. VIL, headquartered in Mumbai (Maharastra, India) and Gandhinagar(Gujarat, India), offered telecom and internet services like 2G, 4G, 4G+, VoLTE, and VoWiFi services and had a GSM network with a PAN India presence. During the year 2019-20, its total income was Rs. 459,968 million, while revenues from operations stood at Rs. 449,575 million and other income was Rs. 10,393 million.
Keywords
Vodafone-Idea; Cash flow; Cash equivalents; Operating Cash flows; Investing Cash flows; Financing Cash flows; Indian Accounting Standard (Ind AS) 7;
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