Vodafone Idea's (Vi) CEO, Akshaya Moondra, during the recent earnings call, said that they are hopeful of closing an external equity funding in the upcoming December quarter. The telco's talks for fundraising have picked up and may be successful in the next quarter. Reported first by ET, Moondra said that the company's discussion with multiple groups of investors on both equity and equity-linked instruments has gained a lot of momentum, especially in the last month.
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The company expects these discussions to be concluded in the coming quarter. Vi is the only private telecom player that is posting losses. The telco can't make major changes until and unless it can get access to huge amounts of capital. A promoter of Vi recently said that they are ready to help with up to Rs 2000 crore in case there's a need to clear dues. But that amount is just not enough for the company's path to make a comeback.
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One of the biggest investments that Vi has to make in the future is for 5G. The telco also needs to improve its 4G rapidly in the country to ensure that it can retain its existing customers. Vi's active customer base in the wireless segment fell down from 207 million to 202 million in Q1 FY24. Thus, the telco is very close to dipping below the 200 million active customer mark.
Another major problem that the company has to address is the 2G customers. The telco needs to find a way to ensure that these 2G customers upgrade to 4G services. This will not only help the company in boosting its average revenue per user (ARPU) but will also help in reducing the costs that 2G brings.
Whatever fundraising activity Vi engages in, it needs to raise a huge quantum of funds. The telco also needs to find a way to optimise costs so that the losses can narrow.
