SBI-Led Consortium Weighs Rs 25,000-Crore Loan for Vodafone Idea After AGR Relief: Report

Discussions between Vodafone Idea and banks have been ongoing since January, when AGR dues were frozen. According to sources, no single lender is willing to take the lead in financing the company, placing the onus on Vodafone Idea to secure broader participation from multiple banks.

“Meetings between banks and Vi are ongoing ever since the AGR dues were frozen in January,” a person aware of the discussions was quoted as saying. “The company’s position, no doubt, has improved, but no bank wants to take the lead in lending to this company. SBI, the lead bank, has made it clear it does not want to be the only bank lending, so the onus is on Vi to convince more banks to take a positive call.”

Vi plans Rs 45,000 crore capex push and 5G expansion

Vodafone Idea plans to invest Rs 45,000 crore over the next three years to expand network coverage, roll out 5G services in key markets, and drive overall growth. This is in addition to the Rs 18,000 crore it has already invested, which demonstrated tangible results, according to the management. The company is targeting double-digit annual revenue growth and aims to triple its EBITDA within three years to better manage future obligations.

Despite the AGR relief, the company continues to face significant spectrum-related payment obligations, including Rs 7,000 crore in FY27, Rs 15,000 crore in FY28, and Rs 28,000 crore in FY29. Bankers emphasise that Vodafone Idea must improve its average revenue per user (ARPU) to strengthen its financial profile and demonstrate repayment capability.

Bankers reportedly said that while the company’s government dues will reduce substantially after the latest AGR relief, Vi still needs to do more to showcase its paying capability. “Vi has to improve its revenue per user to be back in the game, for which they have to invest,” a second person aware of the matter reportedly said. “There are also large spectrum dues which will come up in a few years. A lot of questions are there on the company.”

ARPU growth and market share remain key concerns

While the promoters are seen as strong with the presence of the Aditya Birla group, “banks will need more clarity before they sanction more loans,” the person added, according to the report.

Analysts at Citi Research and Morgan Stanley noted that, with regulatory uncertainty largely behind it, the company is now better placed to close its debt raise.

Morgan Stanley, however, said in a report that even with the current relief, “we continue to believe that a tariff hike (at least 20-25 percent) would be required to sustain current market structure and for the third player to meet its remaining payment obligations.”