Voda Idea Promoters Ready To Put In More Funds: Moondra

Vodafone Idea LtdPremium
Vodafone Idea Ltd

NEW DELHI : Vodafone Idea Ltd promoters are ready to put in additional equity investments, chief executive Akshaya Moondra said, adding that discussions with external investors have picked up pace over the past month after the conversion of equity by the Indian government, with at least three such ongoing discussions.

In a conference call after its March quarter earnings, the top boss of the Aditya Birla Group-promoted carrier said that it was working to raise funding from external investors, which was held up due to a delay in the equity conversion by the government.

“Promoters have contributed equity in the past, and they are also ready to contribute some more equity. The third leg of funding has to come from external investors to bring in equity, and I would say currently, multiple discussions are on, and these discussions have become active in the last one month or so after the government (equity) conversion. We are progressing well on these at least three discussions which are on, and we expect to progress on this and conclude funding," he said.

The chief executive added that talks also picked up pace after Aditya Birla Group chairman Kumar Mangalam Birla returned to the carrier’s board. Moondra clarified that it was continuously engaged with the telecom department–the single largest shareholder–and was updating them on all developments, including improvements in operational efficiencies and the need for investments to get meaningful growth.

The comments come after Mint reported, in separate reports, that Vodafone Idea was working on a revival plan which will be shared with DoT and that the government was concerned about the delay in promoters putting in additional equity as was committed when the government took up 33% equity in the carrier in lieu of interest on dues of 16,000 crore of spectrum payments and AGR payments that were due to the government.

Moondra noted that the launch of 5G services, arrest of customer decline and increase in capex to address capacity constraints will get resolved once external investments into Vodafone Idea come in. “Our capex in any 5G will be dependent on new funding. The plans that we have shared with the banks and investors include 5G investments and a good amount of 5G coverage, and we will be executing and implementing that immediately once the funding is in place," he said.

He also added that the carrier was in ongoing discussions with banks for operational funding for capex, which will be directed towards ramping up 4G coverage that has been stalled for the past 1.5 years, impacting its position among the competition.

“We are confident that the investment coming on, we’ll be able to make significant improvements," he said.

On servicing bank loans, Moondra said that Vodafone Idea would be able to pay up 8,000 crore of the 11,500 crore bank debt in FY24 and the remaining 3,500 crore in the consecutive year.

Moondra reiterated the need for tariffs to rise and tariff structures to move towards higher usage meriting higher payments by customers.

Vodafone Idea also reduced the validity of its lowest plan of 99 for 28 days to 15 days. Moondra added that the carrier had removed some loss-making customer cohorts to reduce costs of customer acquisition.

Vodafone Idea narrowed losses to 6,418 crore for Q4FY23 from 6,563 crore in Q4FY22 and 7,990 crore in Q3FY23. The loss-making carrier improved quarterly revenues and recorded growth in annual revenue for the first time since the merger of Vodafone and Idea Cellular in 2018. Annual revenue rose 9.5% to 42,180 crore from 38,520 crore in FY22 on the back of tariff hikes, better subscriber mix and 4G subscriber additions of 4.6 million in the year.

Catch all the

Corporate news

and Updates on Live Mint. Download The

Mint News App

to get Daily

Market UpdatesBusiness News

.

More Less

Updated: 26 May 2023, 11:17 PM IST

Next Story

No Network

Server Issue

Internet Not Available

RECENT NEWS

Ceasefire Diplomacy: The Role Of International Mediators In The Israel-Hamas Conflict

In the shadow of a conflict that has seen countless escalations, the recent refusal of both Israel and Hamas to entertai... Read more

The Dynamics Of Ceasefire Negotiations In Conflict Zones: A Closer Look At The Israel-Hamas Talks In Qatar

In the labyrinth of international diplomacy, the art of negotiating ceasefires in conflict zones is both a science and a... Read more

Navigating Through Turbulence: The EU's Internal Strife And The Quest For Unity

Brussels - In the grand tapestry of European integration, the fabric has shown signs of wear. The European Union, a rema... Read more

The UN Security Councils Pivotal Role In Mediating The Gaza Truce: A Test Of Diplomacy And International Will

In the Labyrinth of International Politics, a Ray of Hope EmergesAs tensions escalate in the Gaza Strip, the world turns... Read more

Ukraine's Military Buildup: A Shift In Global Arms Dynamics

The geopolitical landscape of Eastern Europe has undergone a significant transformation, driven by the escalation of con... Read more

Evaluating The Long-term Impact Of Tax Cuts On The UK Economy: A Promise Of Productivity Or A Fiscal Fantasy?

The UK's recent budget announcements, aimed at spurring economic growth through tax cuts, have ignited a debate about th... Read more