Vodafone Idea is the worst off when it comes to telecom companies being handed the short arm. Both Vodafone India and Idea Cellular were looking forward to smooth years after synergising their assets and revenues after the Reliance Jio data revolution. However, sadly for them, the situations have only grown worse with the AGR (Adjusted Gross Revenue) issue and dues piling up on their balance sheets. In the latest revelation, it has come to our eyes that Vodafone Idea is likely to require a Rs 70,000 crore equity infusion for a healthy streak in the industry. But, even that is likely to be a part of the help that Vodafone Idea requires in total.
Vodafone Idea Seeking ARPU of Rs 200
Apart from the equity infusion of Rs 70,000 crore, Vodafone Idea in total will require Rs 1 trillion in financial relief by the means of equity infusion, higher ARPU, and some relief on the GST and AGR front. ICRA has presented a smooth situation in the future where the telecom companies are supposed to touch Rs 220 ARPU, but when that is going to happen is the real question.
As per an ET Telecom report, Deutsche Bank remarked that Vodafone Idea will require to hit the Rs 200 ARPU mark to reach sustainable levels in the industry.
Vodafone Idea Setting Eyes On Fundraiser
It’s also worth noting that Vodafone Idea has recently had a positive subscriber growth in the industry after more than a year-long stint of showing negative growth in this department. Secretary of Vi, Anshu Prakash had written to DoT saying that it seeks another year to pay off its spectrum dues of Rs 8,292 crore since the AGR burden is eating off its revenue already. Although Vodafone Idea has talked about a fundraiser, the plans have not been finalised yet.
Vodafone Idea talked about a Rs 25,000 crore fundraiser involving both equity and debt. Vodafone Idea has pushed for floor pricing in the industry, which seems inevitable in the future given the unsustainable prices in the industry.
