Vodafone Idea eyes SBI-led funding deal to support ₹45,000 crore capex plan

Debt-ridden telecom operator Vodafone Idea expects to close a fundraising deal with an SBI-led consortium to support its ₹45,000 crore capex plan, a senior company official said on Tuesday.

During the company's earnings call, Vodafone Idea (Vi) CEO Abhijit Kishore said the company has already raised ₹6,400 crore as the first tranche of funds, including ₹1,183 crore from warrants and debt proceeds, through ECB and Indian private banks.

"We are hopeful of closing the discussion with the PSU banks led by SBI, as well as continuing work on other debt-raised streams," Kishore said.

The company has also placed fresh orders of around ₹9,000 crore for network expansion, out of which ₹1,930 crore was deployed in the June 2026 quarter, he added.

"We have already placed the order for ₹9,100 crore, which includes the ₹1,930 crore of the capex, which has been deployed. We intend to deploy all of this capex in less than two quarters. We are looking at deploying roughly around 3,500 sites a month on an average here on 4G," Kishore said.

The company trailed behind rivals Bharti Airtel and Reliance Jio in network expansion for a long time as it was struggling with huge debt and faced the challenge of a continuous decline of subscribers since 2018, when the company was formed after the merger of Vodafone India and Idea Cellular.

Vi was the biggest telecom operator at the time of the merger with 40.8 crore subscribers. Its customer base has halved due to Reliance Jio's aggressive tariffs and the company's inability to invest in network expansion due to a cash crunch.

The company has rolled out a ₹45,000 crore capex plan spread over a period of three years starting September 2024.

The June 2026 quarter was the first quarter after a long gap when Vi recorded growth in subscriber base.

While Vi recorded around a 2% decline in subscriber base to 19.31 crore from 19.77 crore in the same quarter a year ago, the net addition of the company grew on a quarterly basis.

The company's 4G and 5G subscriber base grew by about 2% to 13 crore from 12.74 crore on a year-on-year basis during the period under review.

The network expansion taken by the company in the last few quarters has shown results with customers upgrading to 5G and 4G services from 2G.

Vi recorded a 10.2% rise in the customer ARPU (average revenue per user) to ₹195 in Q1 FY27, compared to ₹177 in Q1 FY26, driven by customers getting the option to move to premium plans with expansion of 4G and 5G services.

"As we speak, we are over 16,000 sites in 5G. We intend to kind of cover another 200-plus cities over the next two quarters," Kishore said.

When asked about the impact on the company with the proposal to regularise "fastlane" or 5G network slicing technology, Kishore said that the company has seen no impact on its postpaid subscribers due to the service, and net addition of post-paid subscribers on its network has been growing consistently over the last six to eight quarters.

Vodafone Idea has reported a narrowing of loss to ₹3,754 crore in the first quarter of the current fiscal from ₹6,611 crore a year ago.

The improvement in performance was mainly on account of relaxation given by the government on dues, a notional gain in the price of shares earmarked for it by a promoter group and customers opting for premium plans.

The finance cost of Vodafone Idea (Vi) declined by 13% to ₹5,120 crore during the reporting period from ₹5,893 crore in the June quarter of last year.

Its revenue from operations grew 6% year-on-year to ₹11,689 crore during the quarter under review from ₹11,023 crore in the same period of FY26.

(Except for the headline, Fortune India has not edited the content of this PTI report.)