This article first appeared on GuruFocus .
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Revenue:INR11,689 crores, up 6% year-over-year and 3.2% sequentially.
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EBITDA:INR5,034 crores, up 9.1% year-over-year; margin improved to 43.1% from 41.8%.
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Cash EBITDA:INR2,475 crores, up 13.5% year-over-year.
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Customer ARPU:INR195, up 10.2% year-over-year and 2.6% sequentially.
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Subscriber Base:193.1 million customers; first quarter of positive net subscriber additions since merger.
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4G/5G Subscribers:130.1 million, up from 127.4 million in Q1 FY26.
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Data Usage:88.4 petabytes per day, up nearly 28% year-over-year; average data usage per 4G/5G subscriber improved 25.2% to 21.7 GB.
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Depreciation and Amortization:INR5,467 crores for the quarter (INR3,862 crores excluding Ind AS 116 impact).
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Net Finance Cost:INR4,925 crores for the quarter (INR3,701 crores excluding Ind AS 116 impact).
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Exceptional Items:Benefit of INR1,816 crores from fair value adjustment of earmarked shares from CLAM.
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CapEx:INR1,930 crores invested in Q1 FY27; orders worth INR9,000 crores placed to date.
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Bank Debt:Reduced to INR211 crores as of June 30, 2026, from INR1,926 crores a year earlier.
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Free Cash and Bank Balance:INR6,558 crores as of June 30, 2026.
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Release Date: August 11, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Revenue grew 6% year-over-year to INR11,689 crores, with cash EBITDA up 13.5% to INR2,475 crores.
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Achieved first quarter of positive net subscriber additions since the merger, with total subscribers reaching 193.1 million.
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Customer ARPU increased 10.2% year-over-year to INR195, marking 20 consecutive quarters of growth.
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Expanded 4G coverage to 87% and launched 5G services in over 200 cities across all 17 circles.
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Secured credit rating upgrades to Crisil A-/(Stable) and ICRA A-/(Stable), and raised INR6,400 crores in funding, including INR1,183 crores from warrants.
Negative Points
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CapEx deployment was muted in Q1 FY27 at INR1,930 crores due to geopolitical supply chain headwinds.
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Bank debt, though reduced, remains at INR211 crores, with additional NCD borrowings of INR3,300 crores, contributing to a net debt of INR3,489 crores.
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Prepaid subscriber base still faces challenges, with management acknowledging a need for improvement in this segment.
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Seasonal migration of subscribers from urban to rural areas in Q1 led to some subscriber losses in regions with limited network coverage.
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Network OpEx remains under pressure from inflationary costs like diesel, which may impact margins in future quarters.
Q & A Highlights
Q: Can you provide an update on the company's funding status, the CapEx plan, and the progress on the three-year cash EBITDA guidance? A: Abhijit Kishore (CEO) confirmed that the company has raised its first tranche of funding totaling INR6,400 crores, which includes INR1,183 crores from promoter warrants and debt proceeds from ECBs and Indian private banks. He reiterated the CapEx guidance of INR45,000 crores over the next three years, with orders worth INR9,000 crores already placed. The company maintains its guidance to triple cash EBITDA over the next three years, built on a revenue CAGR assumption of around 16.8%.
Q: What is the current net debt position, and can you provide a breakdown of the subscriber additions, specifically regarding M2M and postpaid trends? A: Tejas Mehta (CFO) clarified that the net debt stands at INR3,489 crores, down from INR4,001 crores last quarter, consisting of INR211 crores in bank debt and INR3,300 crores in NCDs. Regarding subscribers, the CEO noted that postpaid and M2M are tracking well with positive net additions, but the company does not provide a specific M2M subscriber breakup. He attributed any perceived dip in postpaid ex-M2M to seasonal factors and timing gaps in certain businesses.
Q: How should we think about the network OpEx trajectory given the significant network expansion, and what caused the sharp increase in roaming access charges? A: Tejas Mehta (CFO) stated that the company has managed to offset inflationary pressures like diesel costs through internal efficiency efforts, though some increases may reflect in coming quarters. Regarding roaming charges, he clarified there is nothing structural, attributing the increase to better participation in the wholesale line of business, which is cash accretive despite having a lower percentage margin.
Q: Do you see any risk to your postpaid customer base from competitors' 5G fast lane plans, and how are you addressing this? A: Abhijit Kishore (CEO) stated that on the contrary, the company has seen an increase in postpaid acquisition and retentivity, with no dip observed across its 2,600-plus retail stores. He emphasized that Vodafone Idea has enough capacity to provide a quality experience to both postpaid and prepaid customers, and does not see the competitive 5G offerings as a challenge.
Q: Can you provide a breakdown of the ARPU growth drivers and the potential for further organic ARPU expansion? A: Abhijit Kishore (CEO) explained that the ARPU growth is driven by a premiumization mix. He highlighted that upgrading a 2G customer to 4G typically yields an ARPU increase of around INR230-240, while migrating a quota-based data customer to a truly unlimited "Nonstop Hero" plan adds INR20-35. With 34% of customers still on 2G and a significant base of multi-SIM users, the company sees substantial headroom for continued organic ARPU growth.
Q: What is the current status of the 4G and 5G network rollout, and what are the medium-term site targets? A: Abhijit Kishore (CEO) confirmed that the company is on track with its three-year guidance of roughly 55,000-57,000 4G sites and 86,000-90,000 5G sites. The company plans to deploy around 3,500 4G towers per month and finish the 4G rollout over the next 18 months. 5G services are currently live in over 200 cities with over 16,000 5G sites, and the company intends to cover another 200-plus cities over the next two quarters.
Q: Is there any discussion with BSNL regarding tower and infrastructure sharing? A: Abhijit Kishore (CEO) confirmed that Vodafone Idea already has an existing tower-sharing relationship with BSNL, but there are no other tower-sharing arrangements currently in place beyond that.
Q: Given the debt levels, is there a possibility of raising equity instead of loans to improve the balance sheet? A: Tejas Mehta (CFO) responded that the company's balance sheet already has a significant amount of equity, with all investments funded by equity. He noted that as an infrastructure company, there is ample room for debt, and the current debt of INR3,489 crores is manageable. The company is currently more focused on debt rather than equity to fund its growth plans.
Q: Can you provide color on the penetration of unlimited data plans and the potential for further subscriber upgrades? A: Abhijit Kishore (CEO) stated that the company is upgrading approximately 3-4% of customers every quarter through its premiumization strategy. With 66% of customers on smartphones (4G/5G) and 34% on 2G, there remains a significant opportunity to upgrade 2G users to data services and migrate existing data users to higher-value unlimited plans.
Q: How should we interpret the subscriber trends, given the divergence between VLR data and the company's reported net additions? A: Abhijit Kishore (CEO) explained that Q1 is typically a seasonal quarter with customers migrating from urban to rural markets, where the company's network coverage is still being expanded. He emphasized that there is no structural challenge, and the company has already seen good traction in July, with improvements in gross additions, acquisition quality, and customer retentivity across both prepaid and postpaid segments.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
