Mumbai : Vodafone Idea Limited (Vi) has entered a new phase of growth after overcoming years of financial uncertainty, with Chairman Kumar Mangalam Birla stating that the telecom operator now has greater financial clarity, stronger promoter backing, and renewed capacity to invest in its business.
In his message to shareholders in the company’s FY2025–26 Annual Report, Birla said FY26 marked a year of resolution, while FY27 would focus on execution as the company works to strengthen its network, improve competitiveness, and accelerate customer and earnings growth.
“FY26 Was a Turning Point”
Birla described FY26 as a milestone year for Vodafone Idea, saying the company had emerged from its most challenging years with improved financial visibility.
“FY26 was a year of resolution. FY27 begins a period of execution. The priorities ahead are clear: execute the network investment programme, strengthen market competitiveness, and translate a stronger balance sheet into sustained growth in customers and earnings,” Birla said.
The Chairman emphasized that the company is now better positioned to pursue long-term growth after resolving several major financial issues that had affected its operations for years.
Three Strategic Priorities for FY27
According to Birla, Vodafone Idea will focus on three key priorities during FY27:
- Accelerating network investment to improve service quality and expand coverage.
- Strengthening market competitiveness in India’s highly competitive telecom sector.
- Growing its subscriber base, revenue, and earnings through improved operational performance.
The company believes these initiatives will help enhance customer experience while improving financial sustainability.
AGR Resolution Brings Financial Clarity
One of the biggest developments for Vodafone Idea during FY26 was the resolution of its long-standing Adjusted Gross Revenue (AGR) issue.
The Department of Telecommunications (DoT) finalized the company’s AGR dues at ₹64,046 crore, significantly lower than the earlier provisional estimate of ₹87,695 crore.
The revised assessment provides Vodafone Idea with greater certainty regarding its long-term repayment schedule, reducing one of the biggest financial overhangs on the company.
The telecom operator stated that it expects to generate sufficient operating cash flows over the next 12 months to meet its obligations toward:
- Lenders
- Spectrum payments
- AGR instalments
as they become due.
Financial Performance Improves
Vodafone Idea reported steady financial improvement during FY26.
Key Financial Highlights
- Revenue: Increased 3% to ₹44,873 crore, compared with ₹43,571 crore in FY25.
- EBITDA: Rose 4.8% to ₹19,003 crore.
- EBITDA Margin: Improved to 43.1%, up from 41.6% in the previous year.
The improvement reflects disciplined cost management, operational efficiencies, and steady revenue growth.
Birla said the stronger financial performance significantly boosted confidence among both investors and lenders.
Strong Promoter Support Continues
The Chairman reaffirmed that Vodafone Idea continues to receive unwavering support from its promoter groups.
Key Capital Support
- The Vodafone Group completed the settlement of the Contingent Liability Adjustment Mechanism (CLAM) receivable worth ₹6,394 crore.
- The Aditya Birla Group committed an additional US$500 million (approximately ₹4,730 crore) through fully convertible instruments.
- Vodafone Idea also successfully raised ₹3,300 crore through Non-Convertible Debentures (NCDs) ahead of the AGR resolution.
According to Birla, these developments, together with stronger credit ratings and a return to positive subscriber additions, provide a solid foundation for the company’s next phase of growth.
Call for Periodic Tariff Hikes
Birla also reiterated the need for periodic tariff adjustments across the telecom industry.
He stated that sustainable pricing is essential to enable telecom operators to:
- Invest in next-generation network infrastructure.
- Expand 5G services.
- Maintain long-term financial health.
- Continue supporting India’s rapidly growing digital economy.
He noted that despite having more than one billion mobile connections, India’s Average Revenue Per User (ARPU) remains among the lowest in the world, limiting the sector’s ability to invest in advanced technologies.
According to Birla, maintaining a financially viable and competitive telecom industry will be critical for India’s digital transformation and its ambition of becoming a developed nation by 2047.
Outstanding Financial Obligations
The annual report also outlined Vodafone Idea’s remaining financial commitments.
Outstanding Liabilities
- Borrowings from banks and financial institutions: ₹4,126 crore
- Loan repayments due by March 2027: ₹726 crore
- Deferred spectrum payment obligations: ₹1.27 trillion
- AGR liabilities: ₹25,254 crore
- Combined spectrum and AGR instalments payable during FY27: ₹7,076 crore
Additionally, the company disclosed contingent liabilities of ₹8,780 crore related to:
- One-Time Spectrum Charges (OTSC) for spectrum beyond 6.2 MHz.
- Spectrum Usage Charges (SUC) from FY2019 onwards.
Outlook
With the resolution of key financial uncertainties, improved operating performance, continued promoter support, and enhanced funding capability, Vodafone Idea believes it is entering a more stable phase focused on execution and growth.
Chairman Kumar Mangalam Birla expressed confidence that stronger finances, sustained investments, expanding network infrastructure, and a focus on customer acquisition will help Vodafone Idea strengthen its competitive position in India’s telecom market while contributing to the country’s long-term digital infrastructure goals.
