Time for Vodafone Idea to act: Management must aim to raise capital

Over the weekend, the government converted the telco's dues into equity shares at a premium, perhaps to keep its stake below 50 per cent and avoid turning Vi into a PSU

The Union government has given a fresh lifeline to Vodafone Idea (Vi) by converting the telco’s outstanding spectrum-auction dues into equity shares, worth ₹36,950 crore, at a premium, in the process raising its stake to around 49 per cent in the company from 22.6 per cent. However, the relief extended by the government, as part of the 2021 Telecom Reforms and Support Package, will help the struggling telecom operator only in the short term. While the Centre could convert further dues of Vi into equity shares later, if the need arises, such a scenario may mean Vi becoming a public-sector