Vodafone Idea FPO sails through on last day despite little retail interest
Vodafone Idea sailed through on Monday, the last day of the bidding process, driven by healthy interest from institutional and non-institutional investors, both of which are fully subscribed.
However, there was little demand from retail investors as the category was booked at just 43%. The Rs 18,000 crore FPO, which opened on April 18, closes today.
Ahead of the offer opening, Vi raised over Rs 5,000 crore from nearly 60 anchor investors, making it the third-largest anchor book after One 97 Communications and Life Insurance Corporation.
Despite the backing of big funds, analysts are quite cautious about retail investors putting their money into the FPO, the largest on D-Street so far.
Even though the offer might be a step in the right direction and alleviate some of the company's concerns, one cannot be sure how long it will take for the company to show some profitability and reduce debt significantly. The telco hasn’t reported an annual profit since 2016.
Analysts further said that given the size of the FPO, investors are selling shares in the secondary market and planning to apply in the primary market.
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«The FPO will bring big funds and it will get oversubscribed. But, investors must not expect major listing gains and avoid taking a blind call. Its a loss making company and cant see them being profitable in the next 12-18 months,» said Avinash Gorakshakar of Profitmart Securities.
VI is the third largest telco in India based on
