“Vi is not just a telecom company, it’s a national asset with 215 million users and about 8,000 MHz spectrum,” said Birla. Investors in Vodafone Idea made a 26% return within a week as the shares of the telecom services company, which were offered at Rs 11 apiece in an FPO, closed at Rs 13.9 on the BSE.
The proceeds from the fund-raise, which was garnered through a follow-on public offering (FPO), will be used to upgrade the loss-making and debt-saddled network’s infrastructure, which will enhance operational efficiencies leading to better performance.
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“The cycle of investment will trigger the cycle of growth,” said Birla at the company’s FPO listing at the NSE on Thursday. He added that “on the back of this fund-raise and continued support from banks, Vodafone Idea will stage a smart turnaround. This moment in some ways, marks the beginning of Vodafone Idea 2.0. I believe that a revitalised Vodafone Idea is important for India”.
Vi, earlier known as Idea Cellular (a partnership between Aditya Birla Group, Tata Group and America’s AT&T) was listed on the bourses 17 years ago. Since then, the India telecom story has been “punctuated by many events and milestones”.
“The successful conclusion of (this fund-raise), India’s largest FPO, marks one such turning point for the industry,” said Birla. Vi’s journey to this point has been shaped significantly by govt’s reform package, which has been encouraging a competitive three-player market. “A nation of 1.4 billion people deserves three private telecom players,” said Birla.
A few years ago, the company had inched towards bankruptcy. The govt, then, converted the company’s dues into equity, thus becoming its largest shareholder. Birla, who had given up his directorship in 2021, returned to the board of Vi in 2023 after govt’s rescue package.
Birla’s conglomerate and foreign partner Vodafone have together invested around Rs 1.7 lakh crore in the telecom business. Ahead of the FPO, Birla personally invested Rs 2,000 crore in Vi.
“The outcome (of the FPO) is nothing but a reflection of trust and confidence shown by Birla himself. It is also an unflinching commitment to the telecom sector that he has demonstrated by putting in his personal money as well as sourcing capital across the globe,” said SBI chairman Dinesh Kumar Khara at the event.
