Vodafone Idea share price trades under pressure; Telco Stock Gains 7% in Past Week; Lost 28% since the start of the year

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To buy to sell Vodafone idea share

Shares of Vodafone Idea traded lower on Monday amid reports that the private sector telecoms company is in advanced talks to raise funds. As of 10:52 a.m., Vodafone Idea’s share price was down 1.3% to Rs 11.1 apiece on NSE, after starting the day at Rs 11.3 apiece. Vi stock moved in a range of Rs 11.1 to 11.5 each.

Over the past week, the telecommunications stock has gained more than 7% and 17% year-on-year.

Vodafone Idea Ltd is in advanced talks with US private equity investor Apollo Global to raise up to $1 billion by selling a mix of debt and equity, mint reported citing two people familiar with the matter.

“We emphasize that the company has been unsuccessful in raising external funds for the past two years and that the recent infusion of funds from promoters will largely be used to pay tower dues. The company is to raise approximately 20,000 to Rs 22,000 crore to step up its network opex, capex and buy spectrum in upcoming 5G auctions,” ICICI Direct Research said in a note.

On April 4, British telecommunications major Vodafone increased its stake in debt-ridden Vodafone Idea Ltd to 47.6% through its subsidiary Prime Metals, according to a regulatory filing released on Monday. The company previously held a 44.4% stake in VIL.

“Prime Metals held 2,18,55,26,081 shares, representing 7.61% of the share capital, of Vodafone Idea Limited (the “Company”). PML acquired 570,958,646 shares of the Company by allotment of shares pursuant to an issue preference of the company,” the filing reads.

On Thursday, Vodafone Idea said its board had approved the allocation of 338.3 crore shares at Rs 13.30 per certificate to three entities of the promoter group – Euro Pacific Securities, Prime Metals and Oriana Investments – for around Rs 4,500 crore.

This includes the allocation of 1,96,66,35,338 equity shares to Euro Pacific Securities (sponsor), 57,09,58,646 equity shares to Prime Metals (sponsor) and 84,64,661 equity shares to Oriana Investments (sponsor group). The telecom operator had announced in March a fundraising plan of Rs 14,500 crore, where promoters would inject Rs 4,500 crore.

Benchmarks traded lower with the 30-stock BSE Sensex index down 0.7% in late morning trading, and the broader NSE Nifty50 gauge down around 0.5% .


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