A consortium of lenders led by the State Bank of India (SBI) has given in-principal approval to Vodafone Idea (VI) for a loan of Rs 14,000 crore. Vodafone Idea is trying to revive its loss-making operations through a number of measures, including the launch of 5G services. There has been no official announcement yet, sources told Moneycontrol. However, the joint venture between Vodafone Group Plc and the Birla Group has received informal commitments from several lenders, including Punjab National Bank (PNB), Bank of Baroda, Union Bank and other private and public sector banks. Funds will be used to launch 5G networks The funds are expected to be distributed in installments by the consortium after the transaction is completed. The funds will be used to repay operational creditors, launch 5G networks and bid for additional spectrum, sources said. He also said that the telecom is working aggressively to meet its big target of raising Rs 25,000 crore after its successful FPO. The company plans to raise Rs 25,000 crore: Vi CEO Vi’s Chief Executive Officer (CEO) Akshay Mundhra had revealed on May 17 that banks want the telecom company to first raise equity before giving loans to the telecom operator. The telecom company plans to raise Rs 25,000 crore and additional non-fund-based facilities of up to Rs 10,000 crore. Mundhra had said, ‘We have been associated with the banks for a long time and they said that the work of raising equity should be completed first, so we have done so. We have started talks with the banks again. We have some capital available and we will be able to complete the discussion with the banks at the right time.’ Vi reduces total bank loan to Rs 4,000 crore from Rs 40,000 crore Vi has reduced its total bank loan from Rs 40,000 crore to around Rs 4,000 crore currently. The company has asked lenders to release funds in line with the equity infusion through its Rs 18,000 crore follow-on public offering (FPO) in April this year. The FPO was over six times subscribed and attracted investors such as GQG Partners and Citigroup Global Markets. VI shareholders approve equity infusion of Rs 2,075 crore On May 8, VI shareholders approved equity infusion of Rs 2,075 crore from Aditya Birla Group (ABG) units on a preferential basis. Along with this, after raising preferential equity of Rs 494 crore from Vodafone Group and ABG in 2022, a total investment of Rs 7,000 crore will be made by both the promoter groups between March 2022 and May 2024. Vodafone Idea’s recent equity fundraiser and debt funding will enable it to expand 4G coverage as well as undertake capital expenditure to launch 5G services. The funding is a smart turnaround to capitalise on the industry’s growth opportunities. The company claims that the funding is a smart turnaround to capitalise on the industry’s growth opportunities. At the same time, analysts say that the amount raised through FPO is less for the company. The funding will help in starting 5G service Analysts said, ‘This funding will help VI expand its 4G network, launch 5G service and increase the number of customers. However, we believe the fund raising is not large enough to have a significant impact on the industry momentum and VI’s debt position.’ Vodafone-Idea suffers fourth-quarter loss of ₹7,674 crore Telecom company Vodafone Idea has suffered a loss of ₹7,674 crore in the fourth quarter (January-March) of FY 2024. The company’s consolidated net loss stood at ₹6,418 crore in the same quarter a year ago. That is, the company’s loss has increased by 19.56% on an annual basis in the fourth quarter. VI released its fourth quarter and annual results on 16 May. Consolidated revenue from operations of VI increased by 0.71% on an annual basis. Revenue from operations stood at ₹10,606 crore in the fourth quarter. Revenue stood at ₹10,531 crore in the same quarter a year ago. The company’s loss increased by 6.6% in FY 2024 VI’s consolidated loss for the entire FY 2024 increased by 6.61% to ₹ 31,238 crore. The loss in FY 2023 was ₹ 29,301 crore. Revenue stood at ₹ 42,651 crore in FY 2024, while VI’s consolidated revenue from operations increased to ₹ 42,651 crore in FY 2024. The revenue in FY 2023 was ₹ 42,177 crore. That is, the revenue has increased by 1.12%. Vodafone Idea’s ARPU stood at Rs 146 Vodafone Idea’s average revenue per user (ARPU) increased marginally to Rs 146 during the fourth quarter. It was Rs 145 in the previous quarter and Rs 135 in the same quarter of the previous financial year. The company was mainly helped by changes in entry-level plans and subscriber upgrades. Number of 4G subscribers stood at 12.63 crores. The company said that the number of its 4G subscribers increased for the 11th consecutive quarter. At the end of the fourth quarter, the number of 4G subscribers stood at 12.63 crores. It was 12.26 crores in the same quarter last year. The company’s overall subscriber base stood at 21.26 crores. Total data traffic for the fourth quarter grew by 4.3% on a yearly basis.
