Vodafone Idea shares zoom 14% as board to believe fundraising

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Shares of Vodafone Idea (VIL) leaped 14 per cent to Rs 10.1 on the BSE on Wednesday after the telecom services and products provider announced that its board will meet on Friday to believe fund-raising plans.


“A assembly of the board of directors of the Company is scheduled to be held on September 4, 2020 to believe and evaluate any and all proposals for raising of funds in a number of tranches by means of a public issue, preferential allotment, private placement, including a qualified institutions placement or through any other permissible mode and/or combination thereof as is also thought to be appropriate, by means of issue of fairness shares or by means of issue of any instruments or securities,” VIL said in a exchange filing. READ THE FILING HERE

On Tuesday, VIL’s inventory had ended 13 per cent lower at Rs 8.89 after the Supreme Court allowed staggered payments towards settlement of Adjusted Gross Revenues (AGR) dues. It allowed for a 10-year repayment period for the AGR liability (at 8 per cent MCLR), with 10 per cent of complete dues to be paid upfront on March 31, 21 and the rest in annual payments from March’22.


“VIL, with pre-Ind-AS 116 EBITDA of Rs 6,800 crore in FY21 and net debt of Rs 1.5 trillion (including the AGR liability), is in a precarious situation. Then again, with payments from Vodafone PLC, Bharti Infratel, and existing operating cash glide (OCF), it could manage the current fiscal, but would require a sizeable price hike and capital infusion,” Motilal Oswal Securities said in a telecom sector update.


At 09:47 am, the inventory used to be up 8 per cent at Rs 9.59 on the BSE, as in comparison to 0.33 per cent rise in the S&P BSE Sensex. A combined 296 million fairness shares changing hands on the counter on the NSE and BSE so far.

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