vodafone idea
Vodafone Idea, which has been struggling with debt and financial crisis for a long time, is now preparing for its biggest change. The company is in rapid talks with the SBI-led consortium of banks on a debt funding package of Rs 35,000 crore. This funding is being considered a game changer for the company, because with this Vodafone-Idea can take a big step towards expanding its network and strengthening its hold in the market.
Company CEO Abhijit Kishore said during the fourth quarter earnings that this package will include a funded facility of Rs 25,000 crore and a non-funded facility of Rs 10,000 crore. This amount will be used in the next three years for 4G and 5G network expansion, infrastructure improvement and providing better service to customers.
Company’s capex target
Vodafone-Idea has set a target of Rs 45,000 crore capex plan for the next three years. The company is increasing network coverage and capacity in key circles like Maharashtra, Gujarat and Kerala. The company claims that there has been improvement in customer addition and retention of old customers in these areas. Vodafone-Idea was struggling for a long time due to AGR dues and heavy debt pressure. But now the company is preparing to strengthen its brand image and make an aggressive comeback in the market. The company hopes to manage its financial obligations in the coming years with the help of better EBITDA, debt funding, promoter investment and tax refunds.
Meanwhile, Aditya Birla Group’s promoter company Suryaja Investments Pte. Ltd. Approval has also been given to issue warrants worth Rs 4,730 crore. These warrants can be converted into equity shares at the rate of Rs 11 per share. This step is expected to further strengthen the financial position of the company. Currently Vodafone Plc holds 16.07 percent stake in the company, while Aditya Birla Group holds 9.57 percent stake. Now the biggest question is whether this Rs 35,000 crore fund will give a new flight to Vodafone-Idea and whether the company will be able to give tough competition to big companies like Reliance Jio and Bharti Airtel. Its picture may become clearer in the coming months.
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