Key Points
- Vodafone Idea shares dropped to ₹6.69, hitting a 52-week low.
- The company plans to launch 5G by Q4FY25, with ₹300 billion in equipment deals.
- It reported a 4% revenue growth to ₹109.3 billion in Q2 FY25.
- Vodafone Idea faces significant debt: ₹1,419.4 billion in spectrum payments and ₹703.2 billion in AGR dues.
- The company lost 5.1 million subscribers, but ARPU rose by 7.8% due to price hikes.
- Ongoing talks with banks and the government to resolve debt and funding issues.
Looma News
Vodafone Idea Limited (VIL) saw its shares fall to ₹6.69, hitting a 52-week low, down ₹0.22 or 3.18% by 1:45 pm. Despite the drop, the company reported a 4% increase in quarterly revenue, reaching ₹109.3 billion for Q2 FY25. However, VIL posted a net loss of ₹71.8 billion for the quarter. Its EBITDA rose 8.2% quarter-on-quarter to ₹45.5 billion, with an EBITDA margin of 41.6%.
The company also announced plans to begin its 5G rollout by Q4FY25, with major equipment deals worth ₹300 billion signed with Nokia, Ericsson, and Samsung. In addition, Vodafone Idea expanded its network by adding 42,000 new 4G sites, boosting network capacity by 14%. The company is targeting 4G coverage for 1.1 billion people by March 2025 and 1.2 billion people by September 2025.
Vodafone Idea has also strengthened its digital offerings, partnering with PayU India for digital payments, Genesys for customer service solutions, and Infinity Labs for AI-powered network services.
Despite these efforts, the company is still grappling with significant debt. It has deferred spectrum payments totaling ₹1,419.4 billion and AGR liabilities of ₹703.2 billion. The company’s bank debt has dropped to ₹32.7 billion from ₹78.3 billion last year, while its cash and bank balances stand at ₹136.2 billion.
VIL experienced a loss of 5.1 million subscribers, mainly due to customers switching providers and SIM consolidations. However, its average revenue per user (ARPU), excluding M2M services, increased by 7.8% quarter-on-quarter, thanks to recent price hikes. The management is in ongoing discussions with banks and promoters to secure funding for capital expenditures and is also working with the government to resolve AGR liabilities and bank guarantee issues.
