Vodafone Idea (Vi) CEO Ravinder Takkar, during the company’s recent earnings call with the analysts, had said that the company is in active talks to raise funds from external investors. Takkar said that fund infusion from the promoters along with tariff hikes, return of bank guarantees, and the government relief package are all seen as a positive thing for the company and the industry by the lenders and investors. It is worth noting that Takkar had said before that Vi isn’t able to raise funds because of the equity conversion that is pending for the government. The outside investors would want to know what they are jumping into and thus won’t make any moves until and unless the government equity conversion process is completed.
Vodafone Idea Might Not be Able to Protect Market Share, Analysts Question Over Light Capex
Vodafone Idea didn’t spend as much as Jio and Airtel during the first quarter of FY23, and it was a point of concern for the analysts. Vi might not be able to protect its subscriber market share because of low capex on 4G. The other players will keep on spending more, improving networks, reaching new places, and eat up Vi’s subscriber market share. Vi’s subscriber churn rate stands at 3.5% right now, which actually quite high. Vodafone Idea CEO said that another round of tariff hikes is coming soon by the end of this year. This will help the company in improving performance metrics a little. Further, during the earnings call, Takkar had said that 5G would definitely come at a premium over 4G. When questioned about the 5G rollout, Takkar said that Vi bought spectrum in 17 priority circles, and the bulk of the telco’s capex spending would go in these priority circles only. But the analysts still feel like there’s an issue with Vi’s low capex spending, and the telco will find it hard to protect its market share.
