On the back of the ₹18,000-crore fundraise through a follow-on offer, Vodafone Idea will stage a smart turnaround, according to Kumar Mangalam Birla, Chairman, Aditya Birla Group.
Speaking at the FPO listing ceremony, Birla said, “This moment in some ways, marks the beginning of Vodafone Idea 2.0. I believe that a revitalized Vodafone Idea is important for India.”
The stock on Thursday closed at ₹13.90, up 5.8 per cent. Vodafone Idea will spend ₹12,750 crore of proceeds for the expansion of the network infrastructure by setting up new 4G and 5G sites and expanding the capacity of existing 4G sites.
“The successful conclusion of India’s largest FPO of ₹18,000 crore marks one such turning point for the telecom industry. The fact that so many marquee investors participated in this equity issuance is a testament to the government’s vision of a digital India. The emphatic oversubscription of the FPO – with the overall book being subscribed 7 times and the institutional book being subscribed 19 times — demonstrates the tremendous potential of the India digital story and Vodafone Idea’s role in it,” Birla said.
Going forward, Vodafone Idea will look for debt funding of around ₹20,000 crore from banks. Dinesh Kumar Khara, Chairman, SBI said the nation needs at least three telecom operators.
“My personal thanks to Birla for ensuring the sector continues to flourish and continues to be the backbone of digitalisation today. This would not be possible unless and until companies like Vodafone Idea contribute in terms of creating infrastructure, be it banking, defence or e-commerce. I think today digital is the way of life, and with the opportunities that exists in the country, if our own investors would not be there, the sector will go away to foreign investors. Not that we are against them, we welcome them, but at the same time, as proud Indians, we should also be the beneficiaries of the growth which will be seen in the sector,” Khara said.