Analysts believe so, though there are still those who feel that the company’s inability to generate healthy cash flows may limit its march towards any credible and quick revival.
Vodafone Idea, which had been formed post merger of Vodafone and Idea Cellular of the Birlas after the disruptive launch of Reliance Jio, has never really managed to show synergy benefits kicking in, even as it drains out cash and loses coveted customers to rivals Jio and traditional competitor Airtel.
“For the company to make a complete turnaround, it urgently requires a strong fund inflow, global partnerships, and a healthy cash register,” a top analyst, who requested anonymity, said.
The stock of Vodafone Idea was hit as it closed the day at Rs 8.9 at BSE, down 13%. Airtel grew by 6% and Reliance Industries (the parent of Jio) by 0.5%. “Even though this (AGR payment judgement) is some sort of a relief, it would still be extremely difficult for Vodafone Idea to manage its finances due to heavy interest outgo and AGR payment outgo,” Hemang Jani, equity strategist at Motilal Oswal, told TOI. “It’s doubtful on how they would manage their business, unless new money flows into the company.”
A senior industry analyst with a top consulting company said the “worst seems to be over” for the company as the uncertainty over its payment tenure and dues is behind it. “The company will now build its business parameters on this reality. Not all is lost. They may survive,” he added.
Legal eagle Mukul Rohatgi, who represented Vodafone Idea in the top court, also said the difficult period is behind the company. “They will survive.”