Vi Needs Rs 76000 Crore to Close Gap with Jio, Airtel

Vodafone Idea (Vi) needs around Rs 76,000 crore for spending on network and telecom gear to close the gap with Airtel and Jio. The telco is still in the early stages of rolling out 5G in India. Airtel and Jio, on the other hand, have deployed 5G in almost every corner of the country. BofA Securities, in its recent report mentioned that Vi will require around $6-$8 billion USD (up to Rs 76,000 crore) to support network rollout. This will be necessary for Vodafone Idea to become a strong number 3 contender in India.

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The American brokerage also mentioned that in case there’s a large equity infusion in the company, that will create a massive dilution risk for the existing shareholders. Vodafone Idea is looking to raise around Rs 25,000 crore out via debt in the near future of its Rs 45,000 crore debt funding plan. The board wants to use this money to spend on network expansion and modernisation.

Jio and Airtel already have around 400 million 5G users combined. BofA said, “Basis our interactions with equipment vendors, we believe that a huge capital infusion ($6-8bn+) may be needed to support network rollout, close gaps on 4G, roll out 5G etc., to make the company a strong no. 3 competitor.”