Vodafone Idea shares surge 4% despite losses widening in Q4

VIL generated operating cash flow of Rs 12,100 crore (up 10% YoY) due to an income tax refund. The capex and spectrum payments declined 60% YoY to Rs 2,000 crore (vs. Rs 5,500 crore in FY23).

After an interest payment of Rs 2,900 crore, FCF stood at Rs 7,300 crore (vs. Rs 3,300 crore in FY23).

Vodafone’s loss (continuing for the last 22 quarters) narrowed by 26 lakh in (vs. 46 lakh in the third quarter) to 21.26 crore.

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Recently, domestic brokerage gave a sell call on the stating that the is a high-risk, high-reward opportunity. In the bull case scenario, it can rally up to Rs 23. However, gave a target price of Rs 14.5 for Vodofone, predicting that telecom tariffs may go up by 20-25% after Lok Sabha elections.

Last month, follow-on public offer (FPO) shares of the stock got listed on the exchanges and opened at a 7.2% premium compared to their FPO issue price of Rs 11. The company raised funds for capex purposes to increase its network infrastructure by expanding the capacity of the existing 4G sites and setting up new 4G and 5G infrastructure as well.

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