Vodafone Idea Shares Falling Could be Good for Fundraising

On Thursday, Vi's share price is still up about 5% from the previous close. The investors would want the price to stabilise first before they can make up their minds. Currently, the Indian government holds the majority 33.14% stake in the telco.

Highlights

  • Vodafone Idea (Vi) shares have climbed about 100% in value if we compare with the price 52 weeks ago (almost one year).
  • If we compare for the last month, the price has fallen about 16-17%.
  • The shares of Vi are trading at Rs 13, which is lower than the Rs 17.55 point that the stock touched on Feb 23, 2024.

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vodafone idea shares falling could be good

Vodafone Idea (Vi) shares have climbed about 100% in value if we compare with the price 52 weeks ago (almost one year). However, if we compare for the last month, the price has fallen about 16-17%. At the time of writing, the shares of Vi are trading at Rs 13, which is lower than the Rs 17.55 point that the stock touched on Feb 23, 2024. While it might be disappointing for many shareholders of the telecom operator, in hindsight, it could be a good thing for the telco that its stock fell a little.




Read More - Vodafone Idea Gets $1 Billion Soft Commitment from Investors: Report

For the unaware, Vi is looking to raise Rs 45,000 crore in debt and equity. The telco would not find equity investors if the value of the company skyrockets suddenly. Thus, the fall in share price would likely be seen as a better opportunity for the telco to attract equity investors as they would be entering the company at a decent price, where they can expect to make positive returns in the future.

On Thursday, Vi's share price is still up about 5% from the previous close. The investors would want the price to stabilise first before they can make up their minds. Currently, the Indian government holds the majority 33.14% stake in the telco. With the infusion of fresh capital into the company, Aditya Birla Group (ABG), a promoter of Vi will increase its stake in the near future.

Read More - Vodafone Idea Only Added 4 Million 4G Users in Four Quarters

Much recently, reports surfaced online that Vi has received $1 billion in soft commitment from investors. This money would also come from its promoter. The telco's goal is to raise about $5.5 billion using both equity and debt instruments. Vi will also likely talk to the banks and the lending institutions for fresh loans as it has timely cleared the bank dues to avoid any scenarios of being dragged to the bankruptcy court.

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