Vodafone Idea (Vi), the third-largest telecom operator in the country, has not been able to raise funds. The telco, despite its many attempts to raise funds over the last few years, has not seen any success. In fact, the telco has been continuously losing out on active customers and reporting losses. In such a condition, fundraising becomes an important activity that needs to happen for the company's survival in the long term. According to a Financial Express report, union telecom minister Ashwini Vaishnaw said that everyone is concerned about the inability of Vodafone Idea to raise funds. The management of the telco has maintained that they are in active talks with the lenders to raise funds.
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If Vodafone Idea can't raise funds in the short to medium term, it will become very hard for the telco to survive in the market post the moratorium period ends. Back in FY22, the Indian government gave the telecom operators an opportunity to defer their adjusted gross revenue (AGR) and spectrum usage charges (SUC) dues along with their interest for the next four years. It came as a blessing for Vi, who had severe liquidity issues. But once the moratorium period ends in FY26, it will become hard for the telco to move the business further if it is not able to raise funds by then.
The Indian government has also converted the accrued interest dues arising from the deferment of the AGR and SUC into equity for itself in Vodafone Idea. This means that the government is now a part of yet another loss-making company. The promoters of the company don't seem to be on the same page either.
The Aditya Birla Group (one of the telco's promoters) seems hopeful for the telco, and the comeback of Kumar Mangalam Birla was also welcome news for Vi. However, Vodafone Group UK has reduced the value of its Indian operations to zero in the books and won't record losses on the account of Vi any more.