Vodafone Idea Limited (VIL), the third-largest telecom operator in the country, is struggling as of now. But very soon, that struggle can be over. The only major bottleneck for Vi is the AGR (adjusted gross revenue) payments that the company needs to make. Vi is trying its best to improve networks at a record pace so that consumers can get a great service. For this, the company elevated the capex to Rs 95 billion in FY25. This is more than what it has done in several years in the past. To make a comeback, Vi not only needs to add high-paying consumers, but it also needs to sort out its AGR payments to the government.
Read More - Vodafone Idea CEO Talks About AGR Relief from Govt
The government is in the stance that it can't help Vi further by taking more stake in the company. Further, there's likely no more help that's going to come for the AGR payments, at least from the reports making rounds online. In the coming quarters, Vi will launch 5G in more circles, and this might help the company in adding more subscribers. The telco has been losing susbcriber market share to the competitors. This has to change pretty fast. In order to change that, over the medium-term, Vi needs to continue to improve networks.
At the same time, the telco has to come up with lucrative offers, which it already is doing. The payments to the banks are going on time, and even the vendors are receiving the payments. The revenues have to go up. But with a declining subscriber base, that would become pretty hard to do. The 5G FWA (fixed-wireless access) service can likely have a positive overall impact on the business and its revenues.
Read More - Vodafone Idea Saw Decent Growth in Postpaid User Base
Profitability is a long scenario, for now, to make a comeback, Vi needs to add subscribers, or at least, reduce the churn rate further. It also needs to sort out out the AGR payments with the government, and that too pretty fast.
