Vodafone Idea shares jump over 13% as board to consider fundraising

© Provided by CNBCTV18 Vodafone Idea shares jump over 13% as board to consider fundraising The share price of Vodafone Idea jumped over 13 percent on Wednesday after the company announced that its board will meet on Friday to consider fund-raising plans. The company’s board will meet to consider fund-raising […]



Vodafone Idea shares jump over 13% as board to consider fundraising


© Provided by CNBCTV18
Vodafone Idea shares jump over 13% as board to consider fundraising

The share price of Vodafone Idea jumped over 13 percent on Wednesday after the company announced that its board will meet on Friday to consider fund-raising plans.

The company’s board will meet to consider fund-raising in one or more tranches by way of public issue, preferential allotment, private placement, including a qualified institutions placement (QIP) and/or through other ways, said the company in a BSE filing.

The stock rose as much as 13.6 percent to Rs 10.10 per share on BSE on the announcement. However, it soon pared gains and was trading 5.62 percent higher at Rs 9.39 per share, at 12:45 pm.

Vodafone Idea had ended more than 13 percent lower in the previous session after the Supreme Court refused to allow the telcos to make the payments for their AGR dues over 20 years. The court has instead given the telcos 10 years to pay the dues.

Vodafone Idea has been the most affected company in terms of the AGR dues to be paid. It has paid Rs 7,854 crore against a demand of Rs 58,254 crore, leaving a balance of Rs 50,400 crore that is yet to be paid.

Nitin Soni of Fitch Ratings said that the SC’s verdict could gradually lead to a “collapse of Vodafone Idea” and hasten the telecom market’s move towards a “duopololy”.

“For 10 years, they will have to make a payment of USD 700-800 million a year. Their EBITDA is insufficient to pay [even] for interest expenses,” he said.

On Monday, ahead of the AGR verdict, Vodafone Idea decided to sell its 11.15 percent stake in Indus Towers for cash as Bharti Infratel decided to go ahead with the merger plan.

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