Vodafone Idea share price falls over 4% after board approval to raise ₹45,000 crore

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₹45,000 crore through equity and debt. Vodafone Idea shares declined as much as 4.85% to ₹15.10 apiece on the BSE. Vodafone Idea said it will raise ₹20,000 crore through a combination of equity or equity-linked instruments and the rest via debt.

The company’s promoters will also participate in the proposed equity raise. The company will call for a meeting of its shareholders on April 2, 2024 and post-shareholder approval it expects to complete the equity fund raise in the coming quarter. “In addition, the company remains actively engaged with its lenders for tying-up the debt funding, which will follow the equity fund raise.

Through a combination of equity and debt, the company plans to raise around ₹45,000 crore," Vodafone Idea said in a release. Vodafone Idea’s bank debt currently stands at less than ₹4,500 crore, it added. Read here: Vodafone Idea board approves ₹45,000 crore fundraise “The equity and debt fund raising will enable the Company to make investments towards significant expansion of 4G coverage, 5G network rollout and capacity expansion.

These investments will enable the Company to improve its competitive positioning and offer an even better customer experience," Vodafone Idea said. The proposed fund raise follows a marked improvement in operating metrics. The Company has managed to grow its 4G subscriber base and ARPUs consecutively for the last 10 quarters, it added.

“With the proposed fundraise and the positive operational developments, the Company is confident of effectively competing in the market," it said. Nuvama Institutional Equities sees Vodafone Idea’s fundraising move as a good beginning for the company, however, the contours of fund-raise remain unclear. Also, with overall debt of ₹2.5 lakh