Vodafone Idea Ltd.’s plans to utilise its future funding to be utilised towards overdue payments to its vendors and capital expenditure towards 4G and 5G.
The cash strapped telecom operator is yet to receive funding basis which it will be able the company’s ability to stay afloat will be determined.
“Our growth capex in terms of expanding our 4G coverage and also rolling out 5G which will go side by side, will happen based on the new funding being tied up,” Akshaya Moondra, chief executive officer of the company said in an earnings call following its second quarter results.
Moondra added that the company will be able to conclude discussions with equity investors in the October to December quarter. Basis this equity funding, the banks “will process the request for bank funding and process their internal approval.”
The company’s second quarter capex spend stood at Rs 520 crore, in contrast with Bharti Airtel whose capex stood at over Rs 9,000 crore in the same period. Vodafone Idea is yet to roll out 5G and has seen no major site additions in the current fiscal.
“We continue to incur some minimal capex and that will continue as to the necessary capex in terms of where we are operating today,” Moondra said.
He further attributed the lack of investment that is preventing Vodafone Idea’s ability to “compete in the market and primarily the lack of 4G coverage.”
The company said in August that a promoter group has promised to infuse Rs 2,000 crore, if required. Its promoters, including Aditya Birla Group and Vodafone Group, hold 18.1% and 32.3% stakes, respectively, as of Sept. 30.
The company has added 18 lakh subscribers to its 4G network in the second quarter of FY24 to 12.47 crore. The overall subscriber based stood at 21.98 crore, witnessing a churn of 16 lakh, the lowest since quarterly subscriber decline since the merger.
