NEW DELHI: Vodafone Idea Limited (VIL), India’s third-largest telecom service provider, announced a Further Public Offering (FPO) of equity shares aggregating up to Rs. 18,000 crore on Friday. The company, in an exchange filing, said that its board of directors approved the FPO on April 11, 2024, and the Capital Raising Committee set the price band today, April 12, 2024. Vodafone Idea set the FPO price between Rs. 10 and Rs. 11 per share.
The company mentioned that the higher end of the price band, Rs. 11, represents a discount of about 26% compared to the recently approved preferential issue price to the promoter entity and a discount of about 15% compared to the last closing price. The FPO is scheduled to open on April 18 and close on April 22.
“The higher end of the price band i.e. Rs. 11 is at a discount of ~26% compared to recently approved preferential issue price to the promoter entity at Rs. 14.87 and a discount of ~15% compared to last closing price of Rs. 12.95,” said the company.
Interested investors can participate by bidding for a minimum lot of 1,298 equity shares, with the minimum application amount calculated at Rs. 14,278 for one lot at the upper end of the price band. Following this, investors can bid in multiples of 1,298 equity shares.
The debt-laden telco is trying to raise funds to improve its financial health and to stay competitive. Recently, it successfully raised Rs. 2,075 crore by issuing preferential shares to Oriana Investments Pte Ltd, a promoter entity within the Aditya Birla Group, at Rs. 14.87 per share, marking a 40% increase from the FPO floor price.
The company, in February 2024, announced its plans to raise funds around Rs. 45,000 Crores through a combination of equity and debt. Recently, the company also sold equity shares to its vendor, American Tower Company (ATC), through the conversion of optionally convertible debentures (OCDs) worth Rs. 1,440 crore.
ATC now holds a 2.87% stake in Vodafone Idea. Meanwhile, the telco's net loss for the October-December quarter narrowed to '6,986 crore' from '8,738 crore' in the previous quarter. Revenue from operations rose 0.5% year-on-year, owing to improvements in subscriber mix, 4G subscriber additions, and an increase in entry-level tariffs.