Vodafone Idea shareholders approve ₹20,000cr fundraise plan for 5G push
Shareholders of Vodafone Idea have approved a ₹20,000 crore fundraising initiative on April 3. Following the announcement, the telecom operator's shares saw a more than 2% increase, reaching ₹13.7 per share. The approved funds are set aside for Vodafone Idea's expansion of its 4G network and the launch of 5G services. As per reports, the fundraise could unlock revenue opportunities for telecom OEMs such as Nokia, Samsung, and Ericsson.
Board has approved only part of the total proposal
Market analysts suggest that these advancements could help Vodafone Idea regain some competitive edge by improving user experience. The company has more than 200 million subscribers, trailing behind Bharti Airtel and Reliance Jio. However, the analysts also noted that the fundraising sum is insufficient to significantly impact the company's market share or its overall debt situation. The board has only approved a part of the initial amount of ₹45,000 crore that was proposed by the company.
Urgent need for Vodafone Idea to invest in infrastructure
Nuvama Institutional Equities highlighted Vodafone Idea's pressing need to invest in infrastructure improvements. They stated, "Both Bharti and Jio have already rolled out 5G in over 5,000 cities and towns, and there is an urgent need for Vodaone Idea to incur capex for 5G rollout and to upgrade the 4G network." "The company needs to improve both its operational and financial metrics, to withstand competition."
