Vodafone Idea says FY27 marks 'period of execution' after AGR relief, capital infusion

Mumbai: Vodafone Idea (Vi) has emerged from years of financial uncertainty and entered a "period of execution" following the resolution of its long-running adjusted gross revenue (AGR) dispute, promoter capital infusion and a return to subscriber additions, chairman Kumar Mangalam Birla said in the company's FY26 annual report.

"FY26 marked a turning point for your Company. After several years of financial uncertainty, the business resolved a number of long-standing challenges," Birla said, adding that the telecom operator was now focused on accelerating network investments and improving competitiveness. "FY26 was a year of resolution. FY27 begins a period of execution."

He reiterated the industry's demand for higher tariffs arguing that telecom should be viewed as critical national infrastructure rather than merely a commercial business.


He noted that India continues to have one of the world's lowest average revenue per user (ARPU) levels, making it difficult for operators to sustain investment and innovation.

The company said "an upward revision of the tariff in the future would drive a meaningful step-up in industry ARPU, further strengthening the investment case for India's telecom sector," adding that "periodic tariff increases remain not merely a commercial lever but a structural necessity to generate reasonable returns on capital, sustain network investments, and support the continued rollout of next-generation technologies."

Vi highlighted the AGR settlement as the biggest financial milestone of the year. Following the Supreme Court's directions, Vodafone Idea's AGR liability was revised to Rs 64,046 crore from a provisional estimate of Rs 87,695 crore, resulting in a one-time profit after tax of Rs 34,552 crore and providing greater visibility on future liabilities.

Revenue for FY26 rose 3% to Rs 44,873 crore, while EBITDA increased 4.8% to Rs 19,003 crore, with margins expanding to 43.1%.

Operationally, the telecom operator said it had begun adding subscribers again from February 2026, with quarterly ARPU rising to Rs 190 and the subscriber base reaching 192.8 million, including 128.9 million 4G and 5G users.

Vi said it has expanded 5G services to more than 80 cities, while its 4G network now covers over 1.1 billion people, or around 86% of India's population.

On capital raising, Birla said promoter commitment remained "unequivocal", with Vodafone Group settling Rs 6,394 crore under the Contingent Liability Adjustment Mechanism and the Aditya Birla Group committing an additional $500 million (around Rs 4,730 crore) equity infusion.

In May, Birla returned to Vi's board as non-executive chairman after stepping down in 2021 at the height of the company's financial crisis. His comeback was widely seen as a vote of confidence in the telecom operator's turnaround and long-term prospects.

The company also raised Rs 3,300 crore through non-convertible debentures and is in discussions with lenders to fund a planned Rs 45,000 crore capital expenditure programme over FY27-FY29, aimed at expanding its 4G and 5G footprint.

Vi is also sharpening its enterprise business, highlighting investments in cloud connectivity, IoT and digital infrastructure. Vodafone Idea said it has built a 1.3 Tbps enterprise corridor connecting major data centres and plans to deploy 12 million smart meters over the next three years, as it expands its managed services and IoT offerings for enterprises and utilities.

Its cybersecurity platform Vi Protect identified nearly 2 billion suspected spam calls and messages and blocked around 250,000 malicious domains during the year.