Vodafone Idea board to decide on proposal to issue ₹2,075 cr equity to promoters in 6 April meet

This follows shareholder approval of the third largest carrier’s proposal to raise ₹20,000 crore from issuing securities.

Vodafone Idea’s board had approved a ₹45,000-crore fundraising initiative, including the ₹20,000-crore equity-based capital infusion from existing investors, on 27 February. With the approval in place, the telecom company is expected to complete the equity fundraising by the end of June.

Existing promoters of the debt-laden telecom services provider will be involved in the equity fundraising, the company had said earlier. It remains unclear whether promoters will include Britain’s Vodafone Group Plc as well.

Following the equity fundraise, Vodafone Idea will look to raise debt, taking the total amount of funding to up to ₹45,000 crore. The fundraise is crucial for it to begin 5G services. The telecom operator remains the only one without consumer-end 5G services, after both Reliance Jio and Bharti Airtel rolled out the services across the country through last year.

The cash-strapped, loss-making mobile phone services provider is the laggard among peers with its biggest challenge being a ₹2.1 trillion debt and falling subscriber base. As per the latest data from Trai, the carrier lost 1.5 million users in January this year, up from a 1.4 million subscribers it lost in December 2023. 

Its total subscriber base stood at 221.5 million as of January, lower than the second-largest telecom firm Airtel which has 382.5 million users, and market leader Reliance Jio that has 464 million users.

Shares of Vodafone Idea were at ₹13.70 on the NSE in early trade on Thursday, up 1% from the previous close in a largely positive market.

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Published: 04 Apr 2024, 09:27 AM IST