Vodafone Idea Q3 Review - Inline Operating Performance As It Continues To Lose Subscribers: Yes Securities

Yes Securities Report

Vodafone Idea Ltd.'s reported inline performance for the quarter. Both, sequential revenue growth and Ebitda margin were as per expectation. It reported sequential decline in revenue of 0.4% QoQ, however, average revenue per user increased by 2% QoQ to Rs 145/month; while, subscriber base declined by 4.6 million QoQ to 215.2 million.

Vodafone Idea 4G addition was better than expected for the quarter at 0.9 million QoQ. There was sequential improvement in Ebitda margin (up 80 basis points QoQ) led by decrease in roaming cost.

Net debt increased to Rs 2.15 trillion in Q3 FY24 versus Rs 2.13 trillion as of Q2 FY24.

We maintain our 'Sell' rating on the stock with target price of Rs 10/share based on enterprise value/Ebitda of 13.1 times on FY26E.

The stock trades at enterprise value/Ebitda of 14.7 times/13.8 times on FY25E/FY26E.

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