Telecom operator Vodafone Idea (Vi) has said its board will consider a proposal to raise about ₹500 crore by issuing equity shares or convertible warrants on a preferential basis to entities belonging to the Vodafone group.
"A meeting of the board of directors of the company is scheduled to be held on Wednesday, 22nd June 2022, inter-alia, to consider a proposal for raising of funds aggregating up to ₹500 crore, by way of issuance of equity shares and/or convertible warrants on a preferential basis to one or more entities belonging to Vodafone Group (one of the promoters of the company)," says the company in a stock exchange filing.
The trading window for dealing in securities of the company will remain closed for all designated persons under the code forthwith and the same shall remain closed till 48 hours from the conclusion of the meeting of the board i.e. till 24 June 2022, both days inclusive. The trading window for dealing in the securities of the company will reopen on 25 June 2022.
Vodafone Idea or Vi stock is trading 1.83% or 0.15 points down today at ₹8.05 as compared to the previous session close of ₹8.20 on the National Stock Exchange (NSE). The stock has fallen 21.18% in the past year, while 48.55% in the year-to-date period.
The telco, which is facing a continuous drop in user base for several months, has been facing financial constraints in wake of stiff competition from Reliance Jio and Bharti Airtel. Vi's gross debt (excluding lease liabilities and including interest accrued but not due) as of March 31, 2022, stood at ₹1,97 lakh crore. This includes deferred spectrum payment obligations of ₹ 1.13 lakh crore, AGR liability of ₹65,950 crore and debt worth ₹18,070 crore.
Fundraising is seen as a key factor in the wake of the Centre launching 5G services this year. From getting spectrum acquisition to enhancing network infra -- the telco will have to make additional investments to stay in the game.
Despite a high debt, and poor financials, Vi seems to be on the right track. The telecom operator reported a consolidated net loss of ₹6,563 crore in the Jan-March quarter, down from ₹7,023 crore in the corresponding period last fiscal. Its revenue also rose 6.46% year-on-year to ₹10,240 crore during the quarter ended March 2022, aided by tariff hikes announced in November last year. On a sequential basis, the telco logged a 5.4% growth in revenue. Vi's average revenue per user (ARPU) also saw a jump in the said quarter at 7.5% to ₹124, compared with ₹115 in the previous quarter.
The average daily revenue growth came in at 7.7% sequentially, which was the highest quarterly growth since the merger of Vodafone and Idea. According to the company, the better revenue was driven by tariff interventions taken in November 2021. Its 4G subscriber base continued to grow on the back of superior data and voice experience offered by Vi GIGAnet.
