Vodafone Idea in talks to raise INR50B debt: Moneycontrol

Vodafone Idea in talks to raise INR50B debt: Moneycontrol

Vodafone Idea Ltd. (Vi) is in advanced discussions to secure INR50 billion in debt funding, according to Moneycontrol. The company is seeking additional capital to support its long-term network expansion plans and maintain its competitive position in the Indian telecommunications market. This move comes amidst ongoing negotiations with banks and other financial institutions to secure the necessary funds.

The company's quarterly earnings report for Q1 FY26 highlighted significant financial performance metrics. Revenue stood at INR110.2 billion, marking a 4.9% year-on-year growth. Cash EBITDA improved by 3.7% year-on-year to INR21.8 billion, while reported EBITDA reached INR46.1 billion. However, the company faced challenges in managing its capital expenditure (CapEx) and debt levels. CapEx spending reached INR24.4 billion during the quarter, while net finance costs amounted to INR57.5 billion. The company also reported a year-on-year increase in consumer ARPU, reaching INR177.4, and added 127.4 million 4G subscribers [1].

Vodafone Idea's debt from banks was reduced to INR19.3 billion as of June 30, 2025, but the company continues to face capital constraints. The company's net debt increased by INR6,900 crores during the quarter, primarily due to CapEx spending. The company aims to meet its CapEx target of INR50 billion to INR60 billion for H1 FY26 by September 2025, but this will require additional funding [1].

The company's strategic collaborations, such as its partnership with AST SpaceMobile for satellite-based mobile broadband, are aimed at enhancing coverage in remote areas. However, the company has faced a subscriber decline of 0.5 million during the quarter, although this was an improvement from previous quarters. The company's VLR subscriber base saw a decline of 2.6 million quarter-on-quarter, raising concerns about subscriber retention [1].

The government's proposed relief package on Adjusted Gross Revenue (AGR) dues could provide some respite. Vodafone Idea's AGR dues may drop to INR28,000 crore from INR83,400 crore, while Airtel's AGR dues may fall to INR10,000 crore from INR42,000 crore. This relief could significantly reduce the company's total government dues, which currently stand at around INR2 trillion [2].

Despite the challenges, Vodafone Idea remains committed to expanding its network and enhancing its service offerings. The company's strategic focus on 4G and 5G expansion, along with its enterprise business growth, is aimed at capturing market opportunities and improving its financial position.

References:
[1] https://finance.yahoo.com/news/vodafone-idea-ltd-bom-532822-070256954.html
[2] https://telecomtalk.info/govt-agr-dues-for-vodafone-idea-airtel/998878/