Vodafone shares gain up to 4% as company's management remains optimistic

Vodafone Idea (VIL) shares rallied up to 4 per cent in Tuesday's session as the company's management sounded positive in its investor presentation. Last at the time of writing the copy, shares of Vodafone Idea were up as much as 2.65 per cent at Rs 13.55 per share, while at the day's high it scaled levels of Rs 13.72 per share.

The company's management in its investor presentation said that after FY25 the price hike as well as subscriber base of the company is expected to see a rise. Price increase and Subscriber additions to drive revenue growth from FY25 onwards, said the company. 

During the last 5 years spanning FY19-24, the company's revenue recorded a 10.2 per cent CAGR growth amid stable period followed by regular price increases and customer upgrade from 2G to 4G.

The company also underlined that enjoys a strong promoter base and a Government of India backing with over 23 per cent stake. Both Vodafone and Aditya Birla Group have invested significant capital into the business.  VIL raised Rs. 25000 crore  in May 2019 through a rights issue, including Rs 17900 crore contributed by the promoter group — Promoter group invested a further ~Rs. 70 bn in last 2 years.

Also, the company has reduced debt from banks and financial institutions has reduced by Rs. 13700 crore over the last 2 years.

The stock in the last one year has climbed 29 per cent.

Goldman Sachs downgraded Vodafone Idea to 'sell'

Citing a likelihood of a decline in market share by as much as an addiitonal 300 basis points over the next 3-4 years, the foreign brokerage downgraded the stocks with a target of Rs 2.5 per share.

Additionally, the company has significant adjusted gross revenue (AGR) and spectrum-related payments, which are expected to begin in financial year 2026, mentioned the brokerage.