Vodafone Idea (Vi), a large Indian telecom operator, might miss out on the said plan to raise funds in the Oct-December 2023 quarter. The telco's CEO, Akshaya Moondra, had said that Vi is in talks with potential investors and hopes to close funding before the end of this calendar year. However, things do not look promising for Vi at the moment. Vi and the investors have not yet confirmed the final terms of the potential deal. Thus, if it happens, the fundraise might not occur within 2023.
Vi still hopes to close the funding talks and raise money this quarter. As reported by ET, Vi is currently talking with the Export-Import (EXIM) Bank of the US. The talks are to raise funds for procuring 5G equipment from vendors who are not willing to offer credit to the telco anymore. The telco is also in talks with potential investors in the US who might invest via equity or equity-linked instruments.
According to the report, Vi said that bank lending will come as soon as the fundraising happens. The telco is in desperate need of funds. With fresh funds, Vi can fuel its 4G investments and also start rolling out 5G. This will help the telco in gaining more 4G subscribers in India. At present, due to inferior network services, Vi has been losing its subscribers to its competitors.
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Vi is looking to raise about Rs 20,000 crore through a mix of debt and equity. The telco's bank debt has been coming down fast, but it still has a lot of statutory debt, which is something that potential investors or lenders would be concerned about. There's definitely an opportunity to regain lost market share, but the fundraising must happen as soon as possible. Vodafone Idea's total active wireless subscriber base has dipped below 200 million, which will definitely impact its overall earnings.