Vodafone Idea Ltd

TO SHAREHOLDERS

Dear Shareholders,

India in the Global Economy:

The global economy has been marked with volatility in 2025 due to trade tensions, geo-politics and the drums of war. Despite challenging global conditions, India remains a bright spot - one of the fastest growing major economies in the world, projected to grow at a rapid clip of 6.2 percent this year. Digital infrastructure and connectivity have emerged as significant driver of economic growth in India. The advent of mobile technology and the internet has bridged the digital divide, bringing connectivity to rural and urban areas alike. The proliferation of affordable smartphones and data plans has revolutionized how Indians access information, conduct business, and communicate. This connectivity has integrated technology into the fabric of daily life and commerce. The digital divide, though narrowed, still exists, particularly in rural areas and is a growth opportunity.

Your Company's performance:

Your Company, underpinned by the support of its strong promoters – the Aditya Birla Group and Vodafone Group - is a major telecommunication operator in India, offering Voice, Data, and other Value Added Services ("VAS"), business connectivity services including IoT, Cloud, Managed Services etc. to millions of users. As of March 31, 2025, the subscriber market share of your Company stands at 17.7% as per TRAI's Subscription Report.

Funding and Investment Cycle

Even amid a challenging environment, your Company has demonstrated confidence in its future by successfully completing substantial equity raise of Rs. 245 billion, including FPO of Rs. 180 billion, preferential issue of Rs. 40 billion to promoters and Rs. 25 billion to vendors. In addition to the above spectrum dues of Rs. 369 billion to the Government of India converted into equity, resulting in a government equity ownership of 49% in your Company.

Following the fund raise, your Company entered into major network agreements worth approximately Rs. 300 billion with three global technology partners-Nokia, Ericsson and Samsung-to initiate full-scale network deployment in October 2024. This marked the beginning of our transformative three-year capex cycle, estimated at Rs. 500–550 billion, out of which Rs. 74.4 billion have already been invested in this year. During the year, we have made significant progress in expanding our network footprint, we added a net ~14,100 broadband towers, almost equivalent to the net cumulative addition of ~14,900 towers in the last four years. These early investments have significantly enhanced network coverage and capacity, resulting in a better customer experience. 4G population coverage expanded by 73 million, reaching approximately 83% in March 2025 up from 77% from an year ago. Simultaneously, 4G data capacity increased by about 31%, contributing to a nearly 28% improvement in 4G speeds. Your Company has launched 5G across multiple cities and it is progressing steadily in a phased manner. This marks just the beginning of a broader investment cycle.

Consequently, we are observing an improvement in operational and financial performance during FY25. Your Company delivered a third consecutive year of annual growth in both revenue and Cash EBITDA. Revenue stood at Rs. 435.7 billion, reflecting a 2.2% year-on-year increase while cash EBITDA rose to Rs. 92 billion registering a year-on-year growth of 9.5%. The Applicable Gross Revenue (ApGR) market share was 16.2% of the Indian mobile telecommunications services indust for the year ended March 31, 2025 as per TRAI Data. During the year ended March 31, 2025, your Company had a leading ApGR market share in the Mumbai and Kerala service areas, and the second largest ApGR market share in Gujarat. For the same period, ApGR market share was over 20% in Haana, Kolkata, Uttar Pradesh (West), Maharashtra and Delhi service areas.

Our ARPU has risen for 15 consecutive quarters, supported by strategic tariff increases and consistent customer upgrades. Our gross subscriber acquisition share has outperformed our subscriber market share for past several quarters, underscoring our competitive edge to attract new users. We have also seen lower decline in the subscriber base in Q4FY25, post the revival of investments from Q3FY25 and we expect such trend to continue as we expand our 4G coverage and launch our 5G services. Our 4G subscriber base has grown in 14 out of the last 15 quarters, with the only decline observed in Q2FY25, where loss of subscribers happened post a tariff hike.

Your Company is confident that this positive trend will continue as we sustain the current pace of capex deployment and build a resilient business.

Focus on Long-term Growth:

Your Company believes that it is well positioned to exploit the growth opportunities in India's rapidly expanding mobile telecommunications industry. Your Company's primary focus has been on network investments to ensure superior customer experience. Your Company's 4G population coverage is over 1.1 billion and it has significantly improved its capacity. Your Company relentlessly pursuits to have the best 4G network through integration and incremental network investments on both data and voice. In parallel, we have prioritized cost optimization, as reflected in declining network costs despite network expansion efforts.

Your Company continues to focus on driving 4G penetration to increase ARPU with attractive offers such as ‘SuperHero' providing Unlimited Data from 12 midnight to 12 noon and ‘Non-Stop Hero' delivering 24x7 Unlimited Data access to cater to the rising data needs of users. Your Company had taken tariff interventions during the year across unlimited bundled plans as well as postpaid plans. Your Company has also been focusing on digital-first approach digitizing all customer touchpoints as well as distribution channel. Further, your Company remains focused on strengthening its position on business services, especially the new and fast-growing segment of IoT and cloud services. Your Company has launched several digital initiatives to address the changing requirements of today's digital society enabling individuals and enterprises to get a range of benefits and value-adds. During the year, your Company continued to steadily building a long-term competitive edge by deepening customer engagement and enabling a rich digital ecosystem that includes Vi Movies & TV, Vi Games, eSports, CloudPlay, and a growing digital marketplace. These offerings not only cater to the evolving digital consumption patterns but also strengthen brand stickiness and loyalty. All these initiatives will improve revenue and profitability and subsequently strengthen your Company's overall competitive position in the market.

Outlook

Looking ahead, we are confident that this positive trajecto will continue as we sustain the current pace of network investments, digital expansion, and operational excellence. The Government, now the largest public shareholder with a 49 percent equity stake, has been a key pillar in our transformation journey. Despite this ownership, promoters continue to retain operational control and remain committed to delivering long-term shareholder value.

I extend my heartfelt appreciation to eve employee of Vodafone Idea for their dedication and to all stakeholders for their continued trust and support throughout this journey.

It gives me great pleasure to present the Annual Report for the fiscal year 2024-25, and I eagerly anticipate your continued trust and confidence in our future endeavors.