Vodafone Idea’s board has approved a fundraising plan of up to Rs 45,000 crore through a combination of equity and debt, as announced in an exchange filing on February 27th.
Of this amount, Rs 20,000 crore will be raised through equity or equity-linked instruments, with the remainder sourced from debt. The company stated that its promoters will also participate in the equity raise.
A shareholder meeting is scheduled for April 2, 2024, where approval will be sought for the proposed equity raise, expected to be completed in the subsequent quarter.
Vodafone Idea intends to engage with lenders to secure debt funding following the equity raise. The company’s bank debt currently stands at less than Rs 4,500 crore.
The funds will be allocated towards expanding 4G coverage, rolling out 5G networks, and enhancing capacity. Vodafone Idea aims to strengthen its competitive position and improve customer experience through these investments.
The board has authorized management to appoint intermediaries such as bankers and counsels to facilitate the fundraising process.
Vodafone Idea emphasized its improved operating metrics, including consecutive growth in 4G subscribers and average revenue per user (ARPU) over the past 10 quarters. The company is focused on delivering competitive data and voice services across its presence areas and enhancing its digital offerings. The positive news of the fundraising plan has bolstered the company’s stock, with shares gaining 4 percent over the past five sessions. On February 27th, Vodafone Idea’s stock settled 4.45 percent lower at Rs 16.1 on the National Stock Exchange. Vodafone Idea, a collaboration between the Aditya Birla Group and Vodafone Group, offers voice and data services nationwide across 2G, 3G, and 4G platforms.
