Vodafone Idea (Vi) CEO Ravinder Takkar stated on Monday that the company expects to complete its fundraising in the current fiscal year.
He hinted that a tariff increase, which is vital for the sector’s existence, would occur shortly.
Takkar made the statements on Monday during a conference call to discuss the company’s second-quarter results. The Corporation reduced its subscriber loss and recorded an improvement in its average revenue per user on a sequential basis (ARPU). The company’s net loss decreased marginally year on year (YoY), to Rs 7,132 crore in the second quarter of FY22. Vi continues to make targeted investments to expand its reach and is in advanced talks with banks and hedge funds regarding loan and equity financing. The funds would be used to make new investments and also to repay approximately Rs 6,000 crore in debt that is due in the coming months.
Takkar stated that the government’s telecom reform package has allayed investor concerns, and Vi anticipates renewed investment interest. He stated that the firm is currently refining its strategic plan and would make a statement on fundraising once it is complete. “We anticipate concluding the exercise by the end of this fiscal year,” Takkar remarked.
He noted that rate increases are likely to occur soon in light of the telecom reform plan. “The time for tariff increases is unquestionably drawing near,” he remarked.
Vi’s Chief Financial Officer (CFO) Akshaya Moondra stated that the reform package will result in the deferral of approximately Rs 58,910 crore in spectrum dues over a four-year period. The corporation is in discussions with the Department of Transportation (DoT) to ascertain the amount of deferred adjusted gross revenue (AGR) dues. Additionally, the reform package will limit the amount of performance-based financial guarantees provided to the government by the corporation. The amount covered by the guarantees will be reduced to 20%.
Vi also anticipates the government returning bank guarantees in light of the four-year suspension on spectrum dues payment. Currently, bank guarantees for a year are required prior to the repayment of spectrum dues.
When asked about rival Jio’s new smartphone and Airtel’s cashback offer, Takkar explained that Vi has partnerships with device makers and financial providers that allow customers to acquire a new cellphone in easy installments. He stated that the plan provides customers with a handset selection and that the company is implementing it to increase customer conversion from 2G to 4G.