Vodafone Idea shares rise 6% on UBS rating upgrade, clock highest turnover

Shares of Vodafone Idea rose over 6% in early deals on Friday after global brokerage UBS upgraded the stock to 'Buy' from 'Neutral'. UBS revised its target price to Rs 18 from Rs 13.10 earlier.  The telecom stock rose 6.64% in the morning session today. Market cap of the firm rose to Rs 99,525 crore. Total 1443.24 lakh shares of the firm changed hands amounting to the highest turnover of Rs 212.27 crore on BSE.     

In terms of technicals, the relative strength index (RSI) of Vodafone Idea stands at 61.3, signaling it's trading neither in the overbought nor in the oversold zone. Vodafone Idea stock has a one-year beta of 1.1, indicating high volatility during the period. Vodafone Idea shares are trading higher than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day  moving averages.         

 The stock hit a 52 week high of Rs 18.42  in January 1, 2024  and fell to a 52 week low of Rs 6.87 on May 25, 2023.

UBS sees an upside of 70-80 per cent in the telecom stock. The brokerage said a relief in the form of AGR reduction by the Supreme Court or equity conversion, moratoriums by the government is highly likely, especially given the government's stated objective of ensuring three viable private telcos.

The stock market is pricing in 15-20 per cent mobile tariff hike in the coming 12-24 months as Vodafone Idea follow-on public offer (FPO) comes to a close and Bharti Airtel Ltd and Reliance look to prioritise return on invested capital (ROIC) over market share gains, said UBS.