Vodafone India Receives Rs 47,700 Crore Equity Infusion From Parent
Vodafone gets largest ever foreign direct investment infusion in the country.
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In the midst of regulatory battles between telecom operators in the country, Vodafone India announced that it received an equity infusion of Rs 47,700 crore from its parent group in the first half of the fiscal year 2017.
While the company didn’t give details about the exact time of the fund infusion, Vodafone India’s Managing Director and Chief Executive Officer Sunil Sood said the funds would be used towards retiring part of its existing debt, right-sizing its spectrum, and for technological improvements.
Vodafone India’s current debt stands at Rs 29,000 crore, Sood said at a press briefing. The figure was significantly lower than the Rs 62,900 crore debt as on March 31, 2016, according to its parent, Vodafone Group Plc.’s annual report. Vodafone India refused to comment on BloombergQuint’s query on the sharp decline in the company’s debt figures.
This equity infusion of Rs 47,700 crore, which we believe is the largest ever in India, will enable Vodafone India to continue its investments in spectrum and expansion of networks across various technology layers delivering the best of experience to our hundreds of million customers.Sunil Sood, Managing Director and CEO, Vodafone India
Vodafone India welcomes competition, Sood said, while referring to the entry of Reliance Jio, and said his company gained 0.6 percent market share in the April to June quarter of the fiscal year 2017. Vodafone India now has a customer base of 200 million, he said.
Vodafone India is a fully owned subsidiary of Vodafone Group Plc. that entered the Indian telecom sector in 2007.
The company is set to take part in the mega spectrum auction in India to be conducted by the Department of Telecommunications in October. Vodafone currently has 4G airwaves in less than half of the 22 circles in the country, and is expected to buy spectrum in several circles in the auction, along with Idea Cellular Ltd., which also has airwaves in less than half the circles, according to a report by ICICI Securities. Presently, only market leader Bharti Airtel Ltd. and new entrant Reliance Jio have 4G airwaves across the country.
Commenting on Reliance Jio’s offer of free voice calls to its customers, Sood said Vodafone had approached the Telecom Regulatory Authority of India (TRAI) and sought its intervention with regard to some products and services being offered by the new entrant.
The incumbent operators – Bharti Airtel, Vodafone, and Idea – have been at loggerheads with Reliance Jio over several issues including points of interconnectivity (PoIs) and some offers put out by the Mukesh Ambani-promoted company.