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Vodafone Idea shares fall 6% as CLSA cuts target price post Q4 numbers

Vodafone Idea shares fall 6% as CLSA cuts target price post Q4 numbers

Vodafone Idea shares fall 6% as CLSA cuts target price post Q4 numbers
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By CNBC-TV18 May 14, 2019 1:39:42 PM IST (Published)

Shares of Vodafone Idea tumbled nearly 6 percent in intra-day trade on Tuesday after global brokerage firm CLSA maintained a 'sell' rating on the stock and cut its target to Rs 12.50 from Rs 27 per share post it's Q4 earnings.

Shares of Vodafone Idea tumbled nearly 6 percent in intra-day trade on Tuesday after global brokerage firm CLSA maintained a 'sell' rating on the stock and cut its target to Rs 12.50 from Rs 27 per share post it's Q4 earnings.

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The telecom operator's consolidated loss narrowed sequentially to Rs 4,881.9 crore in Q4 from Rs 5,004.6 crore in Q3, aided by a 3.4 percent drop in total expenses. Strategic initiatives to improve revenue and average realisation from subscribers helped financials, the company said in a statement.
The stock fell 5.8 percent to hit day's low of Rs 13.60 per share on BSE. At 12:13 pm, it was trading 4.5 percent lower at Rs 13.8 as compared to a 0.16 percent (57 points) fall in BSE Sensex at 37,033.
"Vodafone Idea’s Q4 revenue of Rs 11,700 crore, flat QoQ, missed estimates, while EBITDA of Rs 1,550 crore, up 38 percent QoQ, was ahead of estimates driven by higher-than-expected merger synergies. Despite the EBITDA surprise, the company reported a higher-than-expected loss of Rs 4,900 crore due to Rs 950 crore in exceptionals and lower-than-expected tax writebacks," CLSA said in a report.
The brokerage, however, raised its FY20 EBITDA estimates by 9 percent to factor in the faster-than-expected realisation of synergy benefits.
Meanwhile, Deutsche Bank has a 'Buy' rating on Vodafone Idea with a target at Rs 70 per share. EBITDA is ahead of estimates but revenue growth is soft, it said.
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