Vodafone Idea added 0.3 million subscribers in Q1, its first net addition since 2018, narrowed losses to ₹3,754 crore, beating estimates, but faces a ₹1 trillion cash outgo over three years.
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Vodafone Idea Ltd, India's third-largest telecom operator, added subscribers for the first time since its August 2018 merger in the June quarter, while narrowing its net loss sharply and beating analyst estimates.
The company's customer base rose to 193.1 million from 192.8 million in the preceding quarter, marking its first quarterly net addition since the merger of Vodafone India and Idea Cellular. The subscriber base still fell 4.6 million from a year earlier.
Net loss narrowed to ₹3,754 crore from ₹6,608 crore in the year-ago quarter, beating Bloomberg's estimate of ₹5,391 crore. The result included a one-time gain of ₹1,816 crore from the fair-value adjustment of equity shares to be settled with promoter Vodafone Plc, along with lower total expenses including interest costs. In the March quarter, the company had reported a net profit of ₹51,970 crore driven by a one-time accounting gain from the government's adjusted gross revenue relief.
Revenue from operations rose 6% year-on-year to ₹11,689 crore, also beating Bloomberg's estimate of ₹11,499 crore. Quarterly EBITDA grew 9.1% to ₹5,034 crore.
“Our robust Q1FY27 performance is a strong validation of our defined strategy and disciplined execution,” CEO Abhijit Kishore said in a statement. He added that the company has placed orders worth ₹9,000 crore for network expansion.
The results were announced after market hours. Shares of Vodafone Idea ended 0.7% higher at ₹12.82 on the National Stock Exchange, versus a 0.05% gain in the benchmark Nifty 50.
Debt and spectrum payment overhang
Vodafone Idea's earnings follow a massive AGR relief in April. The government slashed the firm's AGR dues by ₹23,600 crore to ₹64,046 crore after recalculation, deferring bulk payments by 10 years to be paid from fiscal 2036 to 2041.
The company has been seeking bank debt of ₹35,000 crore. The timeline of the debt raise is crucial. Besides a ₹45,000 crore network expansion plan, Vodafone Idea must pay ₹49,000 crore toward spectrum dues over the next three years, bringing its cumulative outgo to nearly ₹1 trillion. In May, the telecom operator laid out an ambitious financial roadmap to generate and secure over ₹1.08 trillion in cash over the next three years.
“The ongoing conversation with the lenders gives us the confidence of successful closure of debt discussions,” Kishore said. “With all critical business parameters now moving in the right direction, our focus remains on execution and AI-led transformation across the organization.”
Simultaneously, Vodafone Idea is holding discussions with state-owned BSNL over potential sharing of telecom infrastructure to reduce operating costs, after an intervention by a parliamentary committee. The government owns a 49% stake in Vodafone Idea. The company told the parliamentary panel that “there are active discussions to further enhance the tenancy of Vodafone Idea Limited on BSNL tower infrastructure for 4G and 5G.”
ARPU and tariff repair
Blended average revenue per user grew 1.7% sequentially to ₹177 a month, from ₹174 in the March quarter, driven by network upgrades and two extra billing days. ARPU excluding machine-to-machine users was ₹195, up from ₹190. By comparison, Reliance Jio's ARPU stood at ₹215.6 at the end of June, while Bharti Airtel's was at ₹264 per month.
Telecom operators including Bharti Airtel and Vodafone Idea have been calling for tariff repair in the sector. Market leader Reliance Jio has signaled confidence in organic ARPU growth. In the company's annual report for FY26, Chairman Kumar Mangalam Birla said India's ARPU remains among the lowest in the world.
“Periodic tariff adjustments are therefore essential if operators are to sustain investment and finance the rollout of next-generation networks,” Birla said.
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