Analysts air concerns over weak vitals of Vodafone Idea post Q1 results, say relief measures critical

Analysts have sounded an alarm over the weak vitals of Vodafone Idea (VIL) post its first quarter results that indicated subscriber losses, ARPU declines, fast deteriorating cashflow and balance-sheet concerns, as several market watchers noted that government or regulatory support is ‘critical’ for its viability amid upcoming payment obligations.

In its note ICICI Securities said it sees “high risk and huge concern for VIL” and that in the wake of growing uncertainties, it has put VIL’s estimates, rating and target price under-review until further clarity.

“We believe existing operation is unlikely to meet upcoming payouts, and risk of default cannot be ruled out, the much anticipated tariff hike/s and capital infusion have been insufficient,” it said flagging the fast deteriorating cashflow and rising liabilities.