Shares of Vodafone Idea (VIL) on Thursday spurted almost 30 per cent on reports of Amazon and US wireless carrier Verizon picking up a stake in the operator.
The rally in the counter also came on the eve of a board meeting that will consider various fund-raising options.
On the BSE, the stock zoomed 26.74 per cent or Rs 2.65 to close at Rs 12.56 . Intra-day, it had risen 29.96 per cent to Rs 12.88 — its 52-week high.
On the NSE, it gained 29.79 per cent to close at Rs 12.85.
In a late evening filing with the bourses, Vodafone Idea said it was constantly evaluates various opportunities as part of its corporate strategy but “there is no proposal as reported by the media that is being considered at the board”.
The filing came after the BSE sought clarification from the company on Thursday over reports suggesting investments by Verizon and Amazon.
Thursday’s sharp rally came amid reports that the telecom joint venture between Vodafone and the AV Birla group may see e-commerce giant Amazon and Verizon investing around $4 billion.
Vodafone Idea had earlier said that a meeting of the board of directors of the company was scheduled for September 4.
Vodafone said the board would consider multiple options to raise funds such as a public issue, preferential allotment, private placement, including a qualified institutions placement..
While there were fears that Vodafone Idea may slip into bankruptcy, analysts said after the Supreme Court judgment, its chances of survival have increased.
“The Supreme Court’s order gives Vodafone Idea just enough breathing space to limp to 2021-22 — the Indus-Infratel merger announced on Tuesday came just in time — but thereafter, major tariff increases will be the absolute minimum to salvage VIL,” analysts at IIFL said in a note.
“From 2022-23, VIL will need to resume Rs 15,500 crore auctioned spectrum deferred instalments. This plus annual AGR payment of Rs 8,000 crore plus capex of over Rs 5,000 crore plus bank interest would total to over Rs 30,000 crore, significantly higher than operating cash flows at current average revenue per user (ARPU),” the note said.
