Vodafone Idea
Stock Snapshot
Price Performance
Vista Outlook
Basis of our Recommendation
Vodafone Idea is navigating a pivotal phase characterized by aggressive network expansion and digital transformation, as highlighted by management's commitment to a ₹45,000 Cr capex plan aimed at enhancing network capacity and improving ARPU. Recent positive net subscriber additions and a focus on converting 34% of its 2G base to 4G/5G are critical for revenue growth. However, the company faces substantial execution risks, including regulatory dues and intense competition, which could impact its long-term growth trajectory. Vista's financial outlook anticipates stable revenue growth and improving margins, supported by the ongoing digitalization trend in the telecom sector. Despite these positive indicators, the company’s weak cash conversion and high valuation relative to peers present significant headwinds. Over the next 12-24 months, key opportunities include the successful execution of the capex plan and the expansion of digital services, while watchpoints include the need for ongoing funding and potential operational challenges from inflationary pressures and competitive dynamics
Why We Like This Stock
- Management's aggressive ₹45,000 Cr capex plan aims to enhance network capacity and improve ARPU
- Positive net subscriber additions indicate a potential turning point in customer engagement and revenue growth
- The expansion of 5G services presents significant revenue potential in a growing digital landscape
Things To Watch Out For
- Substantial regulatory dues and intense competition pose significant execution risks
- Weak cash conversion and high valuation relative to peers raise concerns about financial stability
- Inflationary pressures and operational challenges could impact profitability and margin expansion
Key Parameters
Financial Snapshot
View Technicals Analysis →| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 42,652 | 43,571 | 44,873 | 46,524 | 48,717 |
| Profit Before Tax (Cr.) | -31,238 | -27,465 | -24,059 | -8,351 | -15,186 |
| PBT Margin | -73.2% | -63.0% | -53.6% | -18.0% | -31.2% |
| Net Profit (Cr.) | -32,066 | -27,462 | -24,059 | -6,264 | -11,389 |
| Earnings Per Share | -3.0 | -2.5 | -2.2 | -0.6 | -1.1 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| CLSA | ► Hold | 13 | 01-Oct-2026 |
| Jeffries | ▲ Buy | 20 | 10-Sep-2026 |
| HSBC | ▼ Reduce | 8 | 08-Sep-2026 |
| Axis Securities | ▼ Sell | 13 | 12-Aug-2026 |
| Citigroup | ▲ Buy | 17 | 12-Aug-2026 |
| Motilal Oswal | ► Neutral | 11 | 12-Aug-2026 |
| Nuvama | ► Neutral | 13 | 12-Aug-2026 |
| JPMorgan | ▼ Underweight | 9 | 11-Aug-2026 |
| Nomura | ► Neutral | 13 | 11-Aug-2026 |
| UBS | ▲ Buy | 15 | 09-Jun-2026 |
Company Overview
Show Company Profile
Vodafone Idea Limited, together with its subsidiaries, provides telecommunication services to individuals, communities, and businesses in India. The company offers voice services, such as 4G VoLTE and Voice over WIFI calling; broadband data services on 4G and/or 5G technology; and content and digital products and services, including subscription, digital advertising, gaming, digital marketplace, and utility bill payment app, as well as other value-added services (VAS), caller tunes, missed call alert, and voice and short messaging services; and long distance and internet service provider services. It also engages in renting of passive infrastructure to telecommunication service providers; business of prepaid payment instruments (PPI) and business correspondence; outsourcing backend IT support, data centre operations, and hosting; and provision of high-speed broadband internet access through cable network and high bandwidth internet broadband, and manpower services. In addition, the company trades in mobile handsets, data cards, telecommunication hardware, and related accessories and services; provision of outsourcing services for finance and accounts, human resources, supply chain management, credit and collection support, and customer support; and caters to the information technology (IT) needs for data consolidation. Further, it offers technology, software, hardware, value added services (VAS), application software, and contents and related products and services, which facilitate and develop access to IT enabled VAS products and services on single or multiple platforms or operating systems; mobile wallet and money transfer services; and data centre related services and IT solutions, including E-SIMs activation, as well as prepaid and postpaid plans. The company was formerly known as Idea Cellular Limited and changed its name to Vodafone Idea Limited in August 2018. Vodafone Idea Limited was incorporated in 1995 and is based in Mumbai, India.