Vodafone Idea Ltd. will be disclosing its March quarter results later this evening. The stock is in focus since its successful Follow-on Public Offer, through which it raised a sum of ₹18,000 crore.
Post the fund raise, brokerage firm Nuvama Alternative and Quantitative Research touts Vodafone Idea to be a potential MSCI inclusion during its upcoming review in August. The telecom service provider may be included in the MSCI Global Standard Index, according to Nuvama Alternative.
In case that happens, Vodafone Idea shares could see inflows worth $212 million through the purchase of over 140 crore equity shares or 1.1 times its daily average volume. The announcement for this would be made on August 13, 2024.
Additionally, brokerage firm Kotak Institutional Equities has reinstated coverage on Vodafone Idea with a "sell" rating and a price target of ₹10.
However, the brokerage wrote in its note that the scenario analysis of Vodafone Idea presents a "high risk-reward skew". Kotak Institutional Equities, in its bull case scenario, expects the stock to rise to levels of ₹23, which is nearly double from current levels. On the flip side, it sees the stock falling to as low as ₹7 in its bear case scenario.
Kotak believes that the fund raising exercise from Vodafone Idea ensures continuation of a 3+1 market construct in the medium term. 3+1 alludes to the three private players (Reliance Jio + Bharti Airtel + Vodafone Idea) along with the state-run BSNL.
It added that with easy subscriber gains from Vodafone Idea unlikely, telecom companies can shift focus towards generating adequate returns through tariff hikes.
It is now working with a 15% tariff hike from December 2025 from the earlier projection of 10% in addition to a 20% tariff hike after the ongoing Lok Sabha elections.
Shares of Vodafone Idea are trading 0.8% higher at ₹13.3 ahead of its results. The stock is still down 22% so far in 2024.
Post the fund raise, brokerage firm Nuvama Alternative and Quantitative Research touts Vodafone Idea to be a potential MSCI inclusion during its upcoming review in August. The telecom service provider may be included in the MSCI Global Standard Index, according to Nuvama Alternative.
In case that happens, Vodafone Idea shares could see inflows worth $212 million through the purchase of over 140 crore equity shares or 1.1 times its daily average volume. The announcement for this would be made on August 13, 2024.
Additionally, brokerage firm Kotak Institutional Equities has reinstated coverage on Vodafone Idea with a "sell" rating and a price target of ₹10.
However, the brokerage wrote in its note that the scenario analysis of Vodafone Idea presents a "high risk-reward skew". Kotak Institutional Equities, in its bull case scenario, expects the stock to rise to levels of ₹23, which is nearly double from current levels. On the flip side, it sees the stock falling to as low as ₹7 in its bear case scenario.
Kotak believes that the fund raising exercise from Vodafone Idea ensures continuation of a 3+1 market construct in the medium term. 3+1 alludes to the three private players (Reliance Jio + Bharti Airtel + Vodafone Idea) along with the state-run BSNL.
It added that with easy subscriber gains from Vodafone Idea unlikely, telecom companies can shift focus towards generating adequate returns through tariff hikes.
It is now working with a 15% tariff hike from December 2025 from the earlier projection of 10% in addition to a 20% tariff hike after the ongoing Lok Sabha elections.
Shares of Vodafone Idea are trading 0.8% higher at ₹13.3 ahead of its results. The stock is still down 22% so far in 2024.
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
