Vodafone Idea has scheduled a board meeting on Friday, October 21, to consider and evaluate the proposal for raising funds as it struggles with its debt repayments.
Vodafone Idea said in a filing to NSE and BSE, “Pursuant to Regulation 29(1)(d)/(e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we wish to inform you that a meeting of the Board of Directors of the Company is scheduled to be held on Friday, 21st October, 2022, inter-alia, to consider and evaluate a proposal for issuance of debenture securities convertible into equity shares on a preferential / private placement basis to a vendor, subject to regulatory and other statutory approvals as may be required, including approval of the shareholders of the Company.” Nokia, Huawei, ZTE, Indus Towers, Cisco and HP are its vendors currently.
The company’s efforts to raise ₹20,000 crore as a mixture of debt and equity remains unfulfilled. In May, the then CEO Ravinder Takkar had said that the company was on the verge of closing a significant round of fundraising, intending to raise ₹10,000 crore through equity and the remaining amount through debt.
Last month, Indus Towers had warned the company of service closure over non-payment of dues. Vi is encountering similar troubles with Nokia as well, wherein they are unable to clear dues.
Akshaya Moondra CEO, Vodafone Idea Limited in the Earnings call on August 4, 2022 had said, “CapEx spend for Q1 FY23 was Rs. 8.4 billion versus Rs. 12.1 billion in Q4 FY22. The gross debt as of June 30, ’22 was Rs. 1,990.8 billion comprising of deferred spectrum payment obligations of Rs. 1,166 billion, AGR liability of Rs. 672.7 billion that are due to the government and the debt from banks and financial institutions is Rs. 152 billion.
While the DoT debt has increased because of accrual of interest, the debt from banks and financial institutions has reduced by Rs. 28.8 billion in the quarter. The cash and cash equivalents were at Rs. 8.6 million. As a result, net debt at the end of the quarter stood at Rs. 1,982.2 billion.
We received communication from DoT in this quarter where they have informed the availability of deferment for AGR demands for the years FY18 and FY19. We have exercised the deferment option for these.
On the interest conversion into equity, we have confirmed the amount of Rs. 161.3 billion to the DoT as the net present value towards the interest liability on moratorium period related to AGR dues and deferred spectrum liabilities. We are awaiting final confirmation in this regard. The accounting treatment of this will be done once we issue the shares to the government.”