Vodafone Idea share price rises 3% post Q3 numbers, here#39;s what brokerages have to say

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The average revenue per user (ARPU) rose to Rs 121 in the December quarter from Rs 109 in the September quarter.

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Vodafone Idea share price rose 3 percent in the early trade on February 15 after the telecom company reported a consolidated loss to Rs 4,532.1 crore in the third quarter ended December 2020, as against a loss of Rs 6,438.8 crore in the year-ago period.

The debt-ridden telecom operator posted a consolidated loss of Rs 7,218.2 crore in the previous quarter. The average revenue per user (ARPU) rose to Rs 121 in the December quarter from Rs 109 in the September quarter.

Also Read: Vodafone Idea Q3 results: Loss declines to Rs 4,532.1 crore; revenue sees a slight jump

Here is what brokerages have to say about the stock and the company after Q3 earnings announcement:

UBS | Rating: Neutral | Target: Rs 10

There is stability in operating trends, but performance is still below the peers. The potential market share stabilisation and increase in 4G net additions will bode well.

ARPU increase also bodes well. As of now, continue to see liquidity challenges for the company, CNBC-TV18 reported UBS as saying.

Credit Suisse | Rating: Underperform | Target: Rs 6

There is a minor miss in Q3 earnings, ex-one-offs. The pace of subscriber loss is moderating but market share loss continues.

Leverage remains unsustainable at 25x and underinvestment continues. It needs meaningful capital infusion on an urgent basis, a CNBC-TV18 report said.

Goldman Sachs | Rating: Sell | Target: Rs 3.20

While subscriber erosion has moderated, it continues to lose revenue market share. Goldman Sachs further trimmed topline estimates and expects underperformance versus peers to continue.

The one-time capital raise would not be a sustainable solution to its balance sheet stress. EBITDA would need to be 4x versus December quarter levels for company to be FCF neutral, reported CNBC-TV18.

CLSA | Rating: Underperform | Target: Rs 12

The subscriber losses had decelerated, while AGR awaits correction of errors and huge debt. The Q3 revenue/EBITDA was up 1%/3% QoQ, though both were below the estimates.

The reported losses included a Rs 2,120-crore gain on stake sale of Indus Towers. The RPU rose lower than expected at 2 percent QoQ, while a decline in subscribers was also lower than estimate, CNBC-TV18 reported the brokerage as saying.

At 0920 hours, Vodafone Idea Limited was quoting at Rs 12.90, up Rs 0.40, or 3.20 percent, on the BSE.

The share touched its 52-week high of Rs 13.80 on January 15, 2021 and 52-week low of Rs 2.83 on February 18, 2020. It is trading 6.52 percent below its 52-week high and 355.83 percent above its 52-week low.