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Vodafone Idea tanks 7% ahead of Q3 results; here’s what brokers expect

The brokerage expects average revenue per user (Arpu) of Rs 113 (up 6 per cent QoQ).

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Last Updated: Feb 12, 2020, 04.03 PM IST
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Vodafone-Idea
Kotak has pegged loss at Rs 4,444.30 crore, while revenue at Rs 11,235.5 crore.
NEW DELHI: Shares of telecom major Vodafone Idea tumbled 7 per cent in Wednesday’s session ahead of its December quarter earnings. The company will post its quarterly numbers on Thursday.

Kotak Securities expects a 4 per cent QoQ increase in revenue on the back of tariff hikes, partly offset by fall in subscribers to 308.1 million (311.1 million in Q2FY20).

The brokerage expects average revenue per user (Arpu) of Rs 113 (up 6 per cent QoQ). “Operating leverage benefit and realisation of more cost-saving synergies should drive a 34 per cent increase in Ebitda to Rs 1,400 crore. Expect finance costs to increase sequentially,” said Kotak.

Kotak has pegged loss at Rs 4,444.30 crore, while revenue at Rs 11,235.5 crore. The company had reported a loss of nearly Rs 51,000 crore in the September quarter due to provisioning for its statutory dues.

Edelweiss Securities expects Vodafone Idea to post 1.6 per cent QoQ growth in revenue, taking into account 5.7 million decline in subscriber base primarily due to migration of feature phone subscribers to RJio on back of Jio Phone sales.

“Incorporating the price hike into numbers, we are building in 3.9 per cent QoQ jump in Arpu. We expect margins to jump 80 basis points to 31.7 per cent, on account of synergy benefits realisation,” the broker said. It has pencilled in a loss of Rs 4,620.1 crore.

Commentary on payment of AGR dues, network capex, broadband subscriber addition and capital issue plans will be key monitorables.

Shares of Vodafone Idea closed 7.39 per cent down at Rs 4.51 on BSE.

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