Vodafone Idea Q1 Results Review - All Eyes On Tariff Hike Benefits: ICICI Securities

ICICI Securities Report

Vodafone Idea Ltd. Q1 FY25 print suggests that the company continues to underperform peers, pending acceleration in capex following the completion of fund raise.

Vodafone Idea plans to invest Rs 500–550 billion in network over the next three years with immediate focus on expanding coverage, and decongesting network. Vodafone Idea believes it can start growing again with fair share of subscriber addition, as it plugs the 4G coverage gap and starts adding more data capacity through 4G/5G expansion.

It expects 67–75% of tariff hike benefits to flow to revenue in the next few quarters. Key elements to watch: Capex acceleration and the resultant higher incremental market share.

We keep our Ebitda estimates unchanged, but increase our target price of Rs 15, as we raise FY27E enterprise value/Ebitda multiple to 14 times (from 13.5 times). Maintain 'Hold'.

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