According to the plan submitted to the government earlier this month, ABG and Vodafone Group will soon invest ₹2,000 crore as fresh equity in the company. The promoters have already invested ₹5,000 crore as fresh equity since the government’s telecom revival package in September 2021. As part of the revival plan, the promoters will work with the company to raise another ₹7,000 crore either as direct equity or through convertible structures from external investors, said the people cited above.
Bank debt reduced
ET had reported on February 15 that ABG, which holds close to 18% of Vi, was in talks with foreign lenders to raise fresh funds to be infused as promoter equity. “ABG has tied up around $250 million with foreign lenders but there is a possibility that Vodafone Group may also participate in the funding round,” said one of the persons cited above.
ABG, Vi and Vodafone Group didn’t respond to queries.
Vodafone Idea CEO Akshaya Moondra had said during the fourth-quarter earnings call that the company was in advanced talks with three investors to raise financing for the debt-laden company through equity infusion. In February, the Centre cleared the long-awaited conversion of Vodafone Idea dues worth Rs 16,133 crore into stock after assurances from the promoters of a further equity infusion.Vi has also sought to avail additional borrowings of Rs 25,000 crore in rupee loans from domestic lenders against the committed fresh equity, said the people cited above.”Vi has reduced its overall bank debt from the peak level of Rs 40,000 crore to around Rs 12,000 crore currently and the company has asked lenders to release funds commensurate with the equity infusion that has taken place already from the promoters,” said another person.
According to analysts, Vodafone Idea is likely to face a cash crunch of Rs 25,000 crore in FY26 and requires a steep hike in current tariffs to make up the shortfall. Vi lost 1.3 million 4G users in February, the steepest decline in 21 months for the loss-making carrier. It needs to urgently invest in 4G infrastructure to stem the attrition.
