Vodafone Idea Telecom Infrastructure, a subsidiary of Vodafone Idea, is gearing up for a significant financial move. Sources familiar with the matter revealed that the company is in discussions to raise up to 50 billion rupees ($569.5 million) through a debt sale scheduled for September. The purpose behind this move is to secure funds for fresh capital expenditures to fuel the company's expansion plans.
According to insiders, the subsidiary of India's third-largest wireless carrier intends to issue bonds with two-year and three-year tenors, aiming to raise 30 billion rupees and 20 billion rupees, respectively. The debt sale is expected to involve private credit funds, with the company planning to offer coupons of approximately 12% and 14% on the two-year and three-year bonds, respectively.
While Vodafone Idea declined to comment on the specifics of the debt sale, sources indicated that the funds generated would primarily support the company's expansion efforts. With board approval received earlier this year to raise 200 billion rupees through equity or loans, the telecom operator is actively working to strengthen its financial position and grow its market presence.
Vodafone Idea also has its eyes set on enhancing its 5G services, with plans to expand to additional key cities across 17 priority circles by September 2025. However, the company has faced challenges in meeting outstanding spectrum and revenue-sharing dues since a critical Supreme Court ruling in 2019 resulted in a wider definition of revenue calculations.
To alleviate the financial strain on the company, the government recently converted a portion of Vodafone Idea's spectrum dues into equity, increasing its stake in the telecom operator to 48.99%. As Vodafone Idea continues to navigate through financial hurdles and expand its services, the upcoming debt sale is poised to play a crucial role in supporting its growth trajectory.
