Relief for Vodafone Idea! Promoter-led funding coming soon in company, say sources; stock up 5% – What investors should know

In apparent positive news for Vodafone Idea investors, Zee Business Special Correspondent Chetan Bhutani, quoting sources, mentioned that Vodafone Plc is mulling to invest Rs 5000-7000 crore in its Indian telecom joint venture with Birla Group. 

Bhutani says according to sources, Vodafone Plc had initiated talks with the Department of Telecommunication (DoT, Department for Promotion of Industry and Internal Trade and Finance Ministry immediate after the government's relief measures announcement was made for the telecom sector.

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The discussion between Vodafone Plc and the government was about how well these reforms could be leveraged and could be implemented for maximum advantage, the special correspondent points out.

Lately, the government has also increased the FDI (foreign direct investment) from 49 per cent to 100 per cent through automatic routes. In this regard, the Dot and DPIIT have given a positive affirmation to Vodafone Plc to invest and pick up stake through automatic FDI route, the sources add.

#ZbizExclusive | वोडाफोन आइडिया के लिए बड़ी खबर !

वोडाफोन आइडिया में वोडाफोन PLC ~5000-7000 Cr डाल सकती है

टेलीकॉम रिफॉर्म के बाद वोडाफोन, DoT और DPIIT के बीच हुई बात

जानिए पूरी खबर चेतन भूटानी से..@AnilSinghvi_ @BhutaniChetan #VodafoneIdea pic.twitter.com/LcSBiAJTml

— Zee Business (@ZeeBusiness) September 30, 2021

Vodafone Idea JV constitutes 72 per cent combine shareholding of both companies, as Vodafone holds 53.5 per cent and Idea has an 18.48 per cent stake in the company. This promoter-led funding by Vodafone Plc is expected to happen within 1-2 months.

Mentioning it as good news for the company, Zee Business Managing Editor Anil Singhvi explains the company is all set to make it a big, as the management in an exclusive interview with the managing editor has shown confidence to grow, expand, increase and keep the company afloat.

Moreover, in an apparent big statement, Vodafone Idea’s management said, the government has done what they could for the telecom sector and now it’s our turn and onus on us to utilise this opportunity appropriately. 

Singhvi mentions two important triggers — fundraising plan and tariff hike — would only bring the growth back in the telecom sector. He says, gone are those days of cheap tariff and this increase in plans would eventually be fruitful for Bharti Airtel, Vodafone Idea, and Reliance Jio eventually. 

Technical analyst Kunal Saraogi says, the bad days for the stocks are gone with respect to charts, and the counter is entering into a new territory wherein growth of Rs 13.5-14 per share levels target could be hit soon. He adds, the scrip is showing an ascending triangle is being formed on charts and it has also given a breakout of Rs 11 per share today.

The stock on Thursday has gained over 5 per cent to Rs 11.83 per share on the BSE intraday today. It has gained almost 12 per cent in the last five sessions on the BSE.