Vodafone Idea (Vi) planned capital expenditure (CapEx) of \u20b950,000-55,000 crore over the next two to three years is unlikely to significantly help the ailing telecom carrier regain subscribers that have migrated to rival Reliance Jio and Bharti Airtel\u2019s networks, according to Motilal Oswal. <\/p>\n
\u2018Vi continues to lose market share to peers due to lower ARPU translation, given its inferior subscriber mix and elevated subscriber churn,\u2019 the brokerage firm said in a report, seen by ETTelecom. <\/p>\n
\u2018Despite the likely capex, we believe regaining subscribers would be a tall ask for Vi, given its peers\u2019 superior free cash flow generation and deeper pockets,\u2019 it added. <\/p>\n
Motilal Oswal estimated that Vi\u2019s capex increased to \u20b94,200 crore in Q4FY25, the highest since the merger of Vodafone and Idea Cellular, with the overall FY25 capex rising to \u20b99,600 crore. <\/p>\n
\u2018Despite equity infusion and acceleration in capex, Vi continued to lose market share to peers. On our estimates, it lost ~130bp in subscriber market share (SMS) and ~155bp in revenue market share (RMS) in FY25, among the three private telcos,\u2019 the brokerage said. <\/p>\n
In the fourth quarter (Q4) of fiscal year 2025, Vi\u2019s net loss widened sequentially to \u20b97,166 crore, from \u20b96,609 crore in Q3FY25. Last week, its board of directors approved raising around \u20b920,000 crore more, which is seen as crucial to investing in the expansion of its 4G and 5G networks and arresting subscriber churn. <\/p>\n
The telecom joint venture between India\u2019s Aditya Birla Group and the UK\u2019s Vodafone Group Plc has been unable to control subscriber declines despite launching commercial fifth-generation (5G) services in key markets in the January-March 2025 quarter, including Delhi and Mumbai. <\/p>\n
In the December 2024 quarter, subscriber base had fallen below the 200 million mark for the first time since its merger in 2019. In the March 2025 quarter, it further declined to 198.2 million.<\/p>\n
\u2018We believe the company\u2019s network investments remain contingent on debt raise, which, in turn, is dependent on continued support\/AGR relief from GoI (\u20b9200 bn+ (\u20b920,000 crore) annual cash shortfall over FY26-31E),\u2019 the brokerage firm said. <\/p>\n
According to the report, the stabilisation of Vi\u2019s subscriber base, along with further relief from the government of India, remains imperative for the telco\u2019s long-term survival.<\/p>\n
\u2018Further, with no relief so far on AGR dues (repayments commence March 2026) and no breakthrough on the debt raise, we believe Vi is likely to face an annual cash shortfall of ~\u20b9200 bn (\u20b920,000 crore) and may be unable to meet its capex guidance of \u20b9500-550 bn (\u20b950,000-55,000 crore) over FY25-27E,\u2019 the brokerage said.<\/p>\n","protected":false},"excerpt":{"rendered":"
Vodafone Idea (Vi) planned capital expenditure (CapEx) of \u20b950,000-55,000 crore over the next two to three years is unlikely to significantly help the ailing telecom carrier regain subscribers that have migrated to rival Reliance Jio and Bharti Airtel\u2019s networks, according to Motilal Oswal. \u2018Vi continues to lose market share to peers due to lower ARPU translation, given its inferior subscriber mix and elevated subscriber churn,\u2019 the brokerage firm said in a report, seen by ETTelecom. \u2018Despite the likely capex, we believe regaining subscribers would be a tall ask for Vi, given its peers\u2019 superior free cash flow generation and deeper […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[8],"tags":[],"class_list":["post-936092","post","type-post","status-publish","format-standard","hentry","category-telecom"],"acf":[],"_links":{"self":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/posts\/936092","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/comments?post=936092"}],"version-history":[{"count":0,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/posts\/936092\/revisions"}],"wp:attachment":[{"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/media?parent=936092"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/categories?post=936092"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/telecomlive.in\/web\/wp-json\/wp\/v2\/tags?post=936092"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}