In a major boost to debt-laden Vodafone Idea Limited (VIL), its Rs 18,000 crore follow-on public offer (FPO) achieved full subscription on the third and final day. This marks the largest FPO ever subscribed in India, surpassing previous records set by Yes Bank's Rs 15,000 crore and ONGC's Rs 10,542 crore offerings.
It is to be noted that Adani Enterprises' planned FPO for Rs 20,000 crore was withdrawn due to Hindenburg Research's report.
The qualified institutional buyers (QIBs) portion of Vi's offer was subscribed 1.48 times, while the non-institutional investors (NIIs) portion and the retail segment were subscribed 2.04 times and 0.44 times respectively.
India’s third-largest telecom operator mopped up Rs. 5,400 crore from nearly 70 anchor investors ahead of its FPO. The telco, in an exchange filing, announced allotting 4.91 crore shares to anchor investors at Rs.11 per share.
The anchor investors include prominent names like GQG Partners, Fidelity Investments, UBS Fund Management, Jupiter Fund Management, and AustralianSuper. From India, the investors are India Infoline, Motilal Oswal, HDFC Mutual Fund, SBI General Insurance, and Quant..
The US-based GQG Partners received the highest allocation of Rs. 1,345 crore, while from India, the top position was secured by Motilal Oswal Midcap Fund with an investment of Rs 500 crore.
CEO Akshaya Moondra said the telco will invest a large portion of the fund to improve its network.
He mentioned that the company has allocated overall Rs. 12,750 crore to improve its network while Rs. 5720 crore from the proceeds of FPO towards 5G rollout in the country.
Vodafone Idea has been losing its subscribers to its competitors due to poor investment in its infrastructure. Moondra also mentioned that Vodafone Idea expects to roll out 5G in the next six to nine months. The company, on 27 February 2024, announced plans to raise a total of Rs. 45,000 crores through a combination of equity and debt.
Vodafone Idea successfully raised Rs. 2,075 crores by issuing preferential shares to Oriana Investments Pte Ltd, a promoter entity within the Aditya Birla Group.
Vodafone Idea set the FPO price between Rs. 10 and Rs. 11 per share, representing 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.