Vodafone Idea manages to raise funds, will repay bonds on schedule

The company had also fixed the record date for the next tranche of 7.77% unsecured redeemable NCDs on December 20 and paid the interest on January 4 next year

Bondholders of Vodafone Idea will receive their interest in time on the due date of December 13 as the company managed to raise funds for the repayment, bankers said.

The company had also fixed the record date for the next tranche of 7.77 per cent unsecured redeemable non-convertible debentures on December 20 and paid the interest on January 4 next year.

The company has to pay Rs 6,000 crore to its bondholders beginning December 13 till March next year and plans to use its own cash flows and bank funds to repay its bond holders.

In September, Vodafone Idea paid an additional one percent coupon to debenture holders on account of a credit deterioration event effective from November 22, 2019.

Last year, the Supreme Court had ordered telecom companies to pay 10 per cent of dues to the Centre by March 31, 2021 and balance amount in annual instalments commencing from April 1 this year till March 2031 payable by March 31 of every succeeding financial year.

The SC had agreed with the Indian government that telecom companies should pay their spectrum and licences dues based on their gross revenues.

The AGR dues for Vodafone amounted to Rs 58,250 crore up to FY 2016-17 on the basis of preliminary assessment by the Department of Telecom. Of this, VIL had already paid Rs 7,854 crore towards AGR dues to DoT as on March 31, 2021.

In September this year, the Indian government agreed to give a moratorium of four years to all the telecom companies to repay their dues thus helping Vodafone Idea.

Vodafone Idea stock closed flat at Rs 14.29 a share, giving it a total market valuation of Rs 41,062 crore.

The promoters of the joint venture — Vodafone Plc and the Aditya Birla Group —have said they will not be investing any additional funds into the company. But Aditya Birla group Chairman Kumar Mangalam Birla is expected to infuse funds into the company in his personal capacity. The quantum of the funds to be infused by Birla is not decided as yet.

As part of their comprehensive revival plan, the promoters are also looking for an external investor who will invest funds into the company and to pick up a sizeable stake.