Vodafone Idea Ltd (BOM:532822) Q2 2025 Earnings Call Highlights: Revenue Growth Amidst ...

GuruFocus News
4 min read

In This Article:

  • Revenue: INR109.3 billion, a growth of 4% quarter-on-quarter.

  • Customer Revenue Growth: 5.6% increase driven by price increases effective from July 4.

  • EBITDA (excluding Ind AS 116): INR23.2 billion, improving by 10.5% quarter-on-quarter.

  • EBITDA Margin (excluding Ind AS 116): 21.3%.

  • Reported EBITDA (including Ind AS 116): INR45.5 billion, a growth of 8.2% quarter-on-quarter.

  • Reported EBITDA Margin: 41.6%.

  • Depreciation and Amortization Expenses: INR54 billion.

  • Net Finance Costs: INR63.1 billion.

  • PAT Loss: INR71.8 billion.

  • Debt from Banks: INR32.7 billion, reduced by INR45.8 billion over the last year.

  • Cash and Bank Balances: INR136.2 billion as of September 30, 2024.

  • Deferred Spectrum Obligations: INR1,419.4 billion.

  • AGR Liability: INR703.2 billion.

Release Date: November 14, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Vodafone Idea Ltd (BOM:532822) reported a 4% revenue growth for the quarter, with customer revenues increasing by 5.6% due to recent tariff hikes.

  • The company achieved its highest quarterly EBITDA since the merger, with a 10.5% improvement quarter-on-quarter, reaching INR23.2 billion.

  • Significant network expansion was achieved with the addition of 42,000 4G sites, enhancing 4G data capacity by 14% and increasing 4G population coverage by 22 million.

  • Vodafone Idea Ltd (BOM:532822) has secured deals worth INR300 billion with global partners Nokia, Ericsson, and Samsung for network equipment supply, supporting its three-year CapEx plan.

  • The company is actively working on launching 5G services, with rollouts expected to begin in key geographies in Q4 FY25.

Negative Points

  • Vodafone Idea Ltd (BOM:532822) experienced a loss of 5.1 million subscribers, partly due to increased port-outs to a competitor that did not participate in the tariff hike.

  • The company reported a PAT loss of INR71.8 billion for the quarter, highlighting ongoing financial challenges.

  • Despite network expansions, there was a decline in 4G and 5G subscribers, attributed to SIM consolidation and competition from BSNL.

  • The company's debt from banks remains significant at INR32.7 billion, with deferred spectrum obligations and AGR liabilities totaling INR2,122.6 billion.

  • Vodafone Idea Ltd (BOM:532822) is facing challenges in securing debt funding, with ongoing discussions with banks and the government regarding AGR liabilities and bank guarantee waivers.

Q & A Highlights

Q: This quarter, we had a tariff increase, but subscriber numbers continue to decline. When do you expect to stop customer losses, and how will the INR80 billion CapEx plan impact this? A: Akshaya Moondra, CEO: The quick win CapEx has increased capacity by 14% and coverage by 22 million. We plan to invest INR80 billion in H2 FY25. While it's hard to predict an exact timeline, we aim to turn around subscriber losses by the end of this financial year, leveraging these investments.

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