The telecom sector is in the spotlight, with two major players, Airtel and Vodafone Idea, reporting their Q1 results. Meanwhile, Reliance also reported standalone numbers for Jio that enthused the market watchers. What the Street is eagerly waiting for is the Jio IPO, expected later in the year. The biggest loser among the three was Vodafone Idea (VI).
Here’s how Q1 turned out for Airtel, Vodafone Idea and Reliance Jio.
The company’s PAT jumped 37 per cent YoY to Rs 8,167.4 crore, up 12 per cent QoQ.
Airtel’s subscriber base rose 12 per cent YoY to 68.09 crore, while ARPU increased 6 per cent to Rs 264. Both subscriber growth and higher ARPU supported the company’s quarterly performance.
| Q1FY27 | Q1FY26 | YoY | Q4FY26 | QoQ | |
| Revenue (Rs Crores) | 58,539.1 | 49,462.6 | 18% | 55,383 | 6% |
| EBITDA (Rs Crores) | 33,302.8 | 27,838.7 | 20% | 31,491 | 6% |
| EBITDA Margin% | 57% | 56% | 57% | ||
| PAT (Rs Crores) | 8,167.4 | 5,948 | 37% | 7,325 | 12% |
| Subcriber Base (Crores) | 68.09 | 60.55 | 12% | 66.59 | 2% |
| ARPU | 264 | 250 | 6% | 257 | 3% |
EBITDA increased 9.1 per cent YoY to Rs 5,034 crore, with the EBITDA margin at 43.1 per cent. PAT stood at a loss of Rs 3,754 crore, narrowing from a loss of Rs 6,608 crore a year earlier.
The subscriber base declined 2.3 per cent YoY to 19.31 crore, while ARPU rose 10.1 per cent to Rs 195.
Reliance Jio reported Q1FY27 revenue of Rs 39,173 crore, up 12 per cent YoY, while EBITDA stood at Rs 20,865 crore, with a margin of 53.3 per cent. PAT stood at Rs 7,764 crore.
The subscriber base rose 7 per cent YoY to 53.3 crore, while ARPU increased 3 per cent to Rs 215.6.
Mirroring the mixed performance of telecom companies during Q1, brokerage firms such as Morgan Stanley, Nuvama and others have also offered a mixed outlook for the companies.
Morgan Stanley sees 27% upside
Morgan Stanley retained its ‘Overweight’ rating on Bharti Airtel, while lowering its target price to Rs 2,442 from Rs 2,480. Despite the target cut, the revised price target implies an upside of 27.2 per cent for the stock from the current price level.
The brokerage remains positive on Airtel despite delayed tariff hikes, citing premiumisation-led ARPU growth, strong India mobile revenue and EBITDA, improving ROCE as capex moderates, and growth prospects in Africa and data centres.
Motilal Oswal Maintains BUY
Motilal Oswal maintained its ‘Buy’ rating on Bharti Airtel and raised its target price to Rs 2,335 from Rs 2,270. The price target translates to an upside of nearly 22 per cent from the current market price.
The brokerage highlighted a strong start to FY27, robust free cash flow despite higher capex, and solid performance in India Wireless and Airtel Africa. It expects consolidated revenue and EBITDA to grow by about 14 per cent annually through FY26-29.
| Brokerage | Share Price Target 2026 | Upside% |
| Morgan Stanley | Rs 2,442 (Overweight) | +27.2% |
| Motilal Oswal | Rs 2,335 (BUY) | +22% |
Nomura downgraded Vodafone Idea to ‘Neutral’ from Buy, while raising its target price to Rs 12.6, reflecting a downside of around 5 per cent.
The brokerage said earnings were broadly in line, with subscriber losses arrested and ARPU improving. It flagged the pending capital raise as crucial for subscriber retention and further ARPU growth, while preferring Bharti Airtel.
Nuvama sees marginal upside
Nuvama maintained its ‘Hold’ rating on Vodafone Idea and raised its target price to Rs 13.5 from Rs 10.5, reflecting an upside of just 2.3 per cent.
The brokerage noted stabilising subscriber losses and margin expansion but flagged elevated capex and financial obligations. It expects a slower 5G rollout due to Vodafone Idea’s weak balance sheet and has cut its FY27/FY28 EBITDA estimates.
| Brokerage | Share Price Target 2026 | Upside/downside% |
| Nomura | Rs 12.6 (Neutral) | -5% |
| Nuvama | Rs 13.5 (Hold) | +2.3% |
Additionally, the IPO is expected to comprise solely a fresh issue of up to 27 crore equity shares.
Conclusion
Overall, Q1FY27 highlighted a clear divergence within India’s telecom sector, with Airtel delivering strong growth, Reliance Jio maintaining healthy momentum and Vodafone Idea continuing to face financial and subscriber challenges. Brokerages remain positive on Airtel, cautious on Vodafone Idea, while Jio’s potential IPO remains a key sector catalyst.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
