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    Vodafone Idea

    IDEA
    Telecommunication·11 Nov 2025
    Management Summary

    Vodafone Idea reported a quarter of modest revenue and EBITDA growth, driven by ARPU improvement and network expansion. The company continued its 5G rollout and 4G coverage enhancement, leading to increased data usage. However, Cash EBITDA saw a YoY decline due to investment-related costs, and the significant AGR debt remains a key focus, impacting long-term funding prospects despite a recent Supreme Court judgment.

    Highlights

    5

    • Revenue of ₹11,190 crores, up 2.4% YoY and 1.6% QoQ.

    • Reported EBITDA improved 3% YoY to ₹4,690 crores, with margin expanding 20 bps to 41.9%.

    • ARPU increased 8.7% YoY to ₹180.

    • 4G/5G subscriber base reached 127.8 million, adding 0.4 million over the last 12 months.

    • 5G services expanded to 29 cities in all 17 circles where the company holds 5G spectrum.

    Concerns

    3

    • Cash EBITDA declined 3.4% YoY to ₹2,250 crores due to higher network operating costs from the investment cycle.

    • Marginal drop in overall subscribers this quarter, attributed to seasonality.

    • High AGR debt of ~₹79,000 crores remains outstanding, with banks potentially awaiting clarity on its resolution for long-term funding.

    Key financials

    Metrics

    8

    Periods

    2

    Headline

    7
    • Revenue
      ₹11,190 Cr
      YoY+2.4%QoQ+1.6%
    • Reported EBITDA
      ₹4,690 Cr
      YoY+3%QoQ+1.6%
    • Reported EBITDA Margin
      41.9%
      YoY+0.2%
    • Cash EBITDA
      ₹2,250 Cr
      YoY-3.4%QoQ+3%
    • Cash EBITDA Margin
      21.1%
      QoQ+0.3%

    Q2 FY26

    1
    • Capex
      ₹1,750 Cr

    Capital allocation

    3
    high confidence
    CategoryHeadline
    Capex

    ₹1,750 crores this quarter · ₹7,500 crores (FY26) planned

    internal accrual

    Debt

    Debt disclosed

    Liquidity

    Cash ₹1,380 crores

    Guidance & targets

    3
    CategoryTargetPriority
    Capex
    FY26 Capex
    ₹7,500-8,000 crores
    		High
    Coverage
    4G Population Coverage
    90%
    		Medium
    Subscriber Growth
    Net Subscriber Additions
    inflecting to positive
    		Medium

    AGR Dues Resolution

    next quarter
    CurrentSupreme Court permitted government to reconsider AGR demand
    TargetConcrete steps or timeline from DoT/Government

    Why it matters

    Resolution of AGR dues is crucial for securing long-term debt funding and overall financial stability.

    Our sense is that since the Supreme Court order has come recently, there might be a little bit of a dependency on that from the banks when they are looking at extending long-term funding. But we are engaged with them and working closely, as and when we get to a solution, we will come back to you📌.

    How to verify

    risks_and_concerns[risk='AGR Dues Resolution Timeline']

    Risks & concerns

    2
    RiskSeverity

    AGR Dues Resolution Timeline

    The Supreme Court order allows the government to reconsider AGR demand, but the timeline for a definitive solution remains uncertain, impacting bank funding. — Management acknowledged

    high

    Tariff Hike Implementation

    While a tariff hike is seen as necessary, its timing and industry consensus are uncertain, which could impact ARPU growth. — Management acknowledged

    medium

    Q&A highlights

    8

    “There is some bit of seasonality impact as well, but the fundamentals of the business are intact and we do not see ourselves making any changes to our long-term view as far as the subscriber is concerned. Also, we continue to see the 4G and 5G devices addition on our network as we are rolling out more and more 5G sites and 4G sites.”

    Management attributes subscriber losses to seasonality and emphasizes network improvements and propositions to retain customers, downplaying BSNL's impact.

    asked by Rishabh Dhancholia

    3 min read6 chapters

    Detailed Narrative

    01

    Q2 FY26 Financial Performance Overview

    Vodafone Idea reported Q2 FY26 revenue of ₹11,190 crores, marking a 2.4% year-on-year growth and a 1.6% sequential increase. Reported EBITDA improved by 3% YoY to ₹4,690 crores, with the margin expanding 20 basis points to 41.9%. However, Cash EBITDA declined 3.4% YoY to ₹2,250 crores, attributed to higher network operating costs from the ongoing investment cycle. ARPU saw an 8.7% YoY increase, reaching ₹180, reflecting improved customer value and product propositions.

    02

    Network Expansion and 5G Rollout Progress

    The company significantly expanded its network, increasing 4G population coverage from 77% in March 2024 to over 84% by September 2025. Capex for Q2 FY26 was ₹1,750 crores, contributing to the addition of over 1,500 new unique 4G towers. 5G services have been launched in all 17 circles where the company holds spectrum, covering 29 cities, with plans for further expansion based on customer demand and 5G handset penetration. The company aims to reach 90% 4G coverage in the next couple of quarters with an additional capex of approximately ₹4,000 crores.

    03

    Customer Engagement and Product Initiatives Drive Data Usage

    Vodafone Idea's focus on customer experience led to the launch of the 'Non-Stop Hero Plan' offering unlimited data 24/7, which has driven new customer acquisitions and upgrades. The 'Vi Guarantee Program' also served as a retention tool, providing extra validity. These initiatives contributed to a 21.4% YoY growth in overall data traffic and a 20.3% increase in data usage by 4G/5G subscribers, with average data usage per customer reaching 18.5 GB/day. The 4G/5G subscriber base reached 127.8 million, adding 0.4 million over the last 12 months.

    04

    Vi Business Growth and Digital Transformation

    Vi Business demonstrated strong momentum, showcasing leadership in enterprise digital transformation at IMC 2025 with new offerings like an IoT innovation lab and AI-powered solutions. The Smart Metering business aims to deploy 12 million solutions in the next three years, positioning Vi as a key enabler of India's smart energy transition. Strategic partnerships, such as with Google for MSMEs, and rapid adoption of AI-powered Contact Center as a Service (CCaaS) further strengthen its enterprise offerings, contributing to its position as a trusted digital partner.

    05

    AGR Judgment and Debt Management

    The Hon'ble Supreme Court's judgment in October and November 2025 permitted the Government of India to reconsider and reconcile additional AGR demands. The company is in discussions with the DoT regarding next steps, with total outstanding AGR dues, including interest and penalty, estimated at approximately ₹79,000 crores as of September 25. Debt from banks reduced by ₹1,720 crores over the last 12 months to ₹1,530 crores as of September 30, 2025, with cash and bank balances at ₹1,380 crores. The reduction in finance costs was attributed to vendor settlements and favorable forex fluctuations.

    06

    Capital Expenditure and Funding Outlook

    Vodafone Idea plans a total capex of ₹7,500-8,000 crores for FY26, with ₹4,200 crores already spent in H1 FY26. This capex is primarily for expanding 4G and 5G coverage, along with core and transmission network upgrades, and will be funded through internal accruals. The company is actively engaged with lenders to secure long-term debt financing for its broader capex plans of ₹50,000-55,000 crores. However, banks may be awaiting clarity on AGR dues resolution before committing to long-term funding.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.