Vodafone Idea posts better-than-expected Q3 show: Should you buy, hold or sell?

Vodafone Idea for the 4th ended December 31, 2024 posted better-than-expected fiscal show with nett nonaccomplishment narrowing to Rs 6,609 crore from Rs 7,176 crore successful the September quarter. Zee Business analysts expected nett nonaccomplishment to travel successful astatine Rs 7,150 crore during the reappraisal period.

The gross from operations astatine the telecom institution grew 1.7 per cent sequentially from Rs 10,932 crore successful the September 4th to Rs 11117.3 crore successful the reporting quarter. Analysts estimated gross to travel successful astatine Rs 11,150 crore.

On the operational front, Vodafone Idea posted Rs 4,712.5 crore successful net earlier interest, taxes, depreciation and amortisation (EBITDA) amended successful examination to analysts' estimates, marking a 3.6 per cent emergence quarter-on-quarter (QoQ). EBITDA successful Q2FY25 stood astatine Rs 4,550 crore. 

Margin besides surpassed estimates and improved by 80 ground points oregon 0.8 per cent QoQ to 42.4 per cent successful the December quarter, erstwhile examination to 41.6 per cent successful the erstwhile September quarter. 

Customer ARPU (ex M2M) improved to Rs 173 versus Rs 166 successful Q2FY25, up 4.2 per cent on a QoQ basis, driven by tariff hike and lawsuit upgrades, noted the company's filing with the exchanges.

How planetary brokerages presumption Vodafone Idea banal station Q3FY25 performance?

Global brokerage UBS has maintained its 'buy' standing connected the banal with the people pegged astatine Rs 13, implying imaginable gains of implicit 47 per cent from the erstwhile close. The brokerage noted that the company's Q3 show was broadly in-line. The brokerage added that it volition support an oculus connected the company's capex plan, 5G sum & immoderate imaginable AGR alleviation measures.

Macquarie connected the different manus maintained a 'neutral' stance connected the banal with the people astatine Rs 7. The brokerage pointed retired that erosion successful marketplace stock continued during the reappraisal quarter. Further, it added that portion the summation successful ARPU is trending arsenic per expectations, the continued erosion of the company's subscribers highlights that determination is nary speedy hole to VI's underlying cardinal challenges.

CLSA, meanwhile, maintained a 'reduce' standing with the people astatine Rs 6, implying a important downside of 32 per cent from the erstwhile close. As per the Hong Kong-based planetary brokerage, Vodafone Idea's Q3 gross was beneath estimates, portion EBITDA  came connected expected lines. Furthermore, it pointed retired that ARPU oregon mean gross per idiosyncratic during the reappraisal 4th grew 4 per cent sequentially to Rs 163 led by tariff hikes. Also, subscriber basal nonaccomplishment continued astatine the institution with a sequential nonaccomplishment of 50 lakh customers successful the December quarter. Considering the company's higher-than-expected subscriber loss, CLSA has slashed FY25-27 gross & EBITDA estimates by 2-5 per cent.