Egyptian Acquisition Strengthens Vodacom’s Performance

Vodacom Group Limited’s (JSE: VOD) share price has faced headwinds in the first week of May, extending a year-to-date decline of over 15.7%. Despite the recent weakness, the company’s full-year results for the period ended March 31, 2024, paint a somewhat mixed picture. 

On the positive side, Vodacom delivered strong group revenue growth of 26.4%, driven by the acquisition of Vodafone Egypt. Group service revenue also grew by a healthy 29.1%, with pro-forma growth (excluding Egypt) coming in at a respectable 9.2%. The company boasts a robust customer base of 203.1 million across Africa, demonstrating its strong market position. Furthermore, Vodacom’s commitment to innovation is evident in its target of achieving 25-30% of group service revenue from new services in the medium term. This focus on diversification bodes well for future growth prospects. 

However, the rosy picture is marred by a 10.8% decline in full-year headline earnings. Start-up losses in Ethiopia, rising finance and energy costs, and inflationary pressures all contributed to this decline. The uncertain global economic outlook further complicates the situation. 

Technical Analysis 

The daily chart shows that Vodacom’s share price currently sits at 9,171 cents, within a descending channel pattern. This suggests a potential downtrend. The price remains below the key moving averages [50-SMA (blue line), 100-SMA (orange line), and 200-SMA (red line)], further indicating bearish pressure. Additionally, the RSI hovers around 48.77, suggesting neither strong buying nor selling sentiment. 

However, there are potential signs of a bullish reversal. A break above the 23.60% Fibonacci retracement level (9,788 cents) could signal a shift in momentum, with resistance at the 38.20% level (10,121 cents) potentially limiting further upside. A sustained breakout above both resistance levels could lead to a test of the 50.00% Fibonacci retracement (10,609 cents) and the 61.80% level (11,096 cents) in the coming sessions. 

Conversely, a break below the recent swing low of 8,544 cents could indicate a continuation of the downtrend. Significant selling volume on a breach of this support level might drag the price towards 8,025 cents and 7,594 cents in the short term. 


Vodacom’s fundamentals present a mixed bag. While the company exhibits strong revenue growth and a commitment to innovation, profitability has been impacted by recent challenges. Technically, the share price faces resistance from the descending channel and key moving averages. However, a sustained push above the 23.60% Fibonacci retracement level (9,734 cents) could signal a potential bullish breakout.  

Sources: TradingView, Trading Economics, Reuters, Vodacom, Dow Jones Newswire. 

Piece written by Mfanafuthi Mhlongo, Trive Financial Market Analyst 

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