The board of Vodafone Idea gave their stamp of approval to raise funds up to Rs.14,500 crore, as well as Rs.4,500 from promoter entities.

Either by selling equity or through debt instruments like ADR, GDR, and FCCBs, an amount of Rs.10,000 crore would be raised.

The board approved issuing 3.38 billion equity shares on a preferential basis to the promoter group entity and the telecom is expected to receive shareholder approval for the proposals on March 26.

These shares will be issued to Euro Pacific Securities and Prime Metals (Vodafone Group firms and the company's promoters), as well as Oriana Investments (an Aditya Birla Group subsidiary).

In the words of Vi, “issuance of upto 338 crore equity shares of face value of Rs 10 each at an issue price of Rs 13.30 per equity share (including a premium of Rs 3.30 per equity share), which is at a 10 per cent premium to the floor price of Rs 12.08 for an aggregate consideration of up to Rs 4,500 crore to Euro Pacific Securities and Prime Metals. (Vodafone Group entities and promoters of the company), and Oriana Investments (Aditya Birla Group entity forming part of the promoter group)”.

A week after the telecom announced its exit from Indus Towers, this fundraising decision came in place. Since selling 7.1 percent stake, the telecom is on the lookout to sell its remaining 21 percent holding to investors.

This will appear to be the first equity infusion of funds since the Rs.25,000 crore rights issue in 2019, indicating promoter commitment to the telecom.

Vodafone group once decided to not to make investments in India and Birla group chairman Kumar Mangalam Birla stated that he would give up the stake to the government or any financial entity to prevent the telecom from going under.

An analyst with a domestic brokerage said the fund-raising announcement was on expected lines. “However it will not make much difference as the amount will be used to clear past dues of Indus Towers. It is not growth capital,” he said.