Vodafone Idea Receives Shareholders Approval For Rs 20,000 Crore Fundraising Plan

Over the past 10 quarters, Vodafone Idea has consistently increased its 4G subscriber base and average revenue per user

Vodafone Idea Ltd's (VIL) shareholders have approved the company's plan to raise Rs 20,000 crore through a mix of equity and equity-linked securities. VIL said in an exchange filing on Wednesday that it conducted an Extraordinary General Meeting (EGM) virtually on Tuesday, April 2, 2024, seeking shareholder approval for fundraising. 

The company's board previously approved the fundraising plan proposal on February 27th, marking a significant milestone in the company's strategic planning process. Having secured shareholders' approval, the company anticipates finalising the equity fundraising within the current quarter. Additionally, the company reaffirmed that its promoters are committed to participating in the proposed equity raise. 

Meanwhile, Vodafone Idea continues engaging with lenders to secure debt funding, complementing equity fundraising. By leveraging both equity and debt, the financially constrained operator aims to raise approximately Rs 45,000 crore. The company's bank debt is reported to be less than Rs 4,500 crore, reflecting a relatively stable financial position in this aspect.

As of December end, Vodafone Idea's gross debt amounted to Rs 2.15 lakh crore, which includes various obligations such as deferred spectrum payments of Rs 1.38 lakh crore, an AGR liability of Rs 69,020 crore owed to the government, optionally convertible debentures valued at Rs 1,660 crore, and outstanding dues to banks and financial institutions.

Over the past 10 quarters, the company has consistently increased its 4G subscriber base and average revenue per user (ARPU), a positive trend in operational performance that encouraged the company to seek additional funding from the market. Vodafone Idea's 4G subscriber base has grown to 125.6 million, up from 121.6 million a year earlier.

Furthermore, the company has managed to reduce its consolidated net loss to Rs 6,986 crore in the quarter ending in December, compared to Rs 7,990 crore reported a year earlier and Rs 8,738 crore in the previous quarter.