Vodafone Idea (VI) struggles to raise fresh capital from existing or a new set of investors
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The longer Vodafone Idea (VI) struggles to raise fresh capital from existing or a new set of investors, the deeper it sinks into the abyss of uncertainty. The marginally improved operating performance which VI showed in its September-ended Q2FY22 quarter, for which results were announced last week, is acknowledged. But short- and long-term uncertainties—including repayment of non-convertible debentures, servicing of total debt, the urgent need to invest in 4G technology and buying 5G spectrum next year—are real investor concerns and continue to weigh down the stock.
VI and Bharti Airtel, to some extent, got lifelines from the government in September, through a four-year moratorium for companies to pay up statutory dues. VI has, like Bharti Airtel, accepted the moratorium for spectrum dues. The VI board in October-end also agreed to opt for a four-year moratorium on payment of Adjusted Gross Revenues (AGR) dues. It means that additional funds will flow to the company and not towards paying back the government.