Shares of telecom operator Vodafone Idea have witnessed a remarkable resurgence this week, recording their strongest weekly performance in three months amid multiple positive developments that have reignited investor interest in the struggling telecom major.
Stock Performance Hits New Highs
The buying momentum intensified throughout the week, with Vodafone Idea stock closing in positive territory for three consecutive sessions before surging another 6% during Friday's trade on November 14. This impressive rally pushed the stock price to ₹11.08 per share, marking a significant milestone as it crossed the Follow-on Public Offer price of ₹11 for the first time since September 2024.
The current price level also represents Vodafone Idea's one-year high, with the stock gaining approximately 14% during the week. If the stock maintains these levels until market close, it will register the company's most robust weekly showing since mid-August, signaling a potential turnaround in investor sentiment.
Quarterly Results Exceed Expectations
The company's September-quarter financial performance provided the initial spark for the renewed optimism. For the quarter ending September (Q2FY26), Vodafone Idea reported a net loss of ₹5,524.2 crore, demonstrating substantial improvement compared to the ₹7,176 crore loss recorded in the same period last year.
Sequentially, the financial health showed further improvement, with the net loss narrowing from the ₹6,608 crore reported in the preceding June quarter. The company's consolidated revenue from operations reached ₹11,194.7 crore during the quarter, reflecting a 2.4% increase from ₹10,932.2 crore in the September 2024 quarter.
A key performance indicator, the Average Revenue Per User (ARPU), came in at ₹180, significantly surpassing analysts' expectations of ₹166. This represents an 8.45% increase from ₹166 in Q2FY25, though it showed a slight dip from ₹177 in Q1FY26. The ARPU improvement was primarily driven by customer upgrades and recent tariff increases.
Operational Improvements and Brokerage Upgrades
The company's strategic investments in expanding its 4G network infrastructure have started yielding tangible results. Vodafone Idea concluded the September quarter with 127.8 million 4G/5G subscribers, up from 125.9 million in the corresponding period last year, indicating successful customer retention and acquisition efforts.
The improved operational metrics and financial performance prompted several brokerage firms to revise their ratings and price targets for the stock. Motilal Oswal maintained its 'Neutral' rating while slightly adjusting its price target to ₹9.5 from the previous ₹10. The brokerage emphasized that the Supreme Court's judgment on AGR dues represents a positive development that could facilitate Vodafone Idea's long-pending debt fundraising initiatives.
JM Financial upgraded its target price to ₹11 from ₹9.5 while maintaining an 'Add' rating on the stock. The brokerage now anticipates a partial AGR waiver of approximately ₹160 billion before the end of FY26 and expects an extension of the AGR moratorium beyond March 2026, given the company's inability to meet the upcoming ₹160 billion installment.
Regulatory Relief and Future Prospects
The Supreme Court's recent decision allowing the government to consider providing complete relief on Vodafone Idea's AGR dues has emerged as a crucial positive trigger. This regulatory development, combined with reports of potential tariff hikes next year, has created a favorable environment for the company's recovery.
Vodafone Idea continues to pursue its ambitious capital expenditure plans of ₹500–550 billion and remains actively engaged with lenders to secure necessary debt financing. The company invested ₹17.5 billion in capital expenditure during the September quarter, underscoring its commitment to network expansion and technological upgrades.
While the recent developments have injected fresh optimism into Vodafone Idea's prospects, analysts caution that sustained turnaround will depend on additional tariff increases and reduced competitive intensity in the telecom sector. The company's ability to navigate these challenges while leveraging government support and regulatory relief will determine its long-term viability in India's highly competitive telecommunications market.
