 "Vodafone Idea FPO opens: Price band, how to apply & all you need to know")
Vodafone Idea FPO details: Vodafone Idea's Rs 18,000-crore follow-on public offer (FPO) will open for subscription on Thursday, April 18. The three-day FPO will close on Monday, April 22, 2024.
According to reports, the allotment for the Vodafone Idea FPO could be finalised on Tuesday, April 23, 2024. That apart, Vodafone Idea FPO will list on both the exchanges, that is the BSE, and the National Stock Exchange (NSE), with the listing date likely fixed as Thursday, April 25, 2024.
Here's all you need to know about Vodafone Idea's FPO:
Vodafone Idea FPO price band
The Vodafone Idea FPO price band is set at Rs 10 to Rs 11 per share. The minimum lot size for an application is 1,298 shares.
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Retail investors are required to invest a minimum of Rs 14,278. The minimum lot size investment for sNII is 15 lots (19,470 shares) for Rs 214,170, while for bNII, it is 71 lots (92,158 shares) worth Rs 10.14 lakh.
Vodafone Idea FPO Reservation
Qualified Institutional Buyers (QIBs) will have not more than 50 per cent of the Net Issue; High Net-worth Investors (HNIs) will have not less than 15 per cent of the Net Issue; and Retail Investors will have Not less than 35 per cent of the Net Issue.
Vodafone Idea FPO allotment, listing dates
According to reports, the allotment for the Vodafone Idea FPO could be finalised on Tuesday, April 23, 2024.
Those investors, who would not be able to get the allotment, will have their invested amount returned likely on April 24, 2024.
Vodafone Idea FPO will list on both the exchanges, that is the BSE, and the National Stock Exchange (NSE), with the listing likely on Thursday, April 25, 2024.
How to apply to Vodafone Idea FPO?
Investors can apply either through their existing trading account or the ASBA application can be directly logged through the internet banking account.
This can only be done through the authorised list of self-certified syndicate banks (SCSB). In an ASBA application, the requisite amount is only blocked at the time of application and the necessary amount is debited only on allotment.
Vodafone Idea FPO objective
According to Vodafone Idea's FPO document, it aims to raise the FPO amount to purchase equipment for the expansion of the network infrastructure by setting up new 4G sites; increasing the capacity of existing 4G sites and new 4G sites; and setting up new 5G sites.
It will also fulfill delayed spectrum payments to the DoT, including GST, and general corporate reasons.
Vodafone Idea FPO Anchor allotment
Vodafone Idea has allotted 4.9 billion shares to anchor investors at Rs 11 apiece — the top end of the price band — raising Rs 5,400 crore.
Vodafone Idea FPO Anchor investors
A total of 74 schemes received allotments in the anchor category, with US-based GQG Partners subscribing to Rs 1,347 crore worth of shares, nearly a quarter of the available shares in the anchor category.
Other large subscribers included Fidelity, Stichting, Redwheel, Motilal Oswal Mutual Fund, and Troo Capital.
Of the total anchor book, 16.2 per cent was allotted to five domestic mutual funds — HDFC, Motilal Oswal, Quant, Baroda BNP, and 360One — through 11 schemes.
Vodafone Idea Shareholders
After the share sale, the promoter shareholding in Vodafone Idea, currently at 48.75 per cent, will drop to 36.87 per cent.
At present, Kumar Mangalam Birla, Hindalco Industries Limited, Grasim Industries Limited, Birla TMT Holdings Private Limited, Vodafone International Holdings B.V., Al-Amin Investments Limited, Asian Telecommunication Investments (Mauritius) Limited, CCII (Mauritius), Inc., Euro Pacific Securities Ltd, Vodafone Telecommunications (India) Limited, Mobilvest, Prime Metals Ltd, Trans Crystal Ltd, Omega Telecom Holdings Private Limited and Usha Martin Telematics Limited are the Promoters of the company.
Vodafone Idea Financials
Vodafone Idea reported net loss and cash loss of Rs 29,371 crore and Rs 6,251 crore, respectively, in FY23. Both these figures worsened on a year-on-year basis.
By comparison, it reported a net loss of Rs 23,563 crore and a cash loss of Rs 6,681 crore during the April-December period of 2023-24.
Vodafone Idea has already seen a loss of 17 million wireless subscribers over the past one year, of which 1 million were lost in the month of January 2024 alone. By comparison, Reliance Jio added about 4.2 million wireless subscribers in January 2024, while Bharti Airtel added 0.75 million subscribers, according to the latest data released by the Telecom Regulatory Authority of India (Trai).
Vodafone Idea FPO: Should you subscribe?
Analysts' views remain mixed on Vodafone Idea's FPO.
While one section of the analysts say the fundraising could strengthen Vodafone Idea's infrastructure, the other section says the company faces challenges on the financial front.
Kishor Ostwal, managing director at CNI Research, for instance, remains sceptical on the returns that the investors will be able to generate in the Vodafone Idea stock going ahead. Vodafone Idea's business model, he said, is not worth appreciating considering the fact the company will always be short of funds for 5G and 6G technology.
Those at IIFL Securities, on the other hand, suggest subscribing to the issue as the brokerage believes a combination of significant fund raising, increase in average revenue per user (ARPU), and a potential favourable outcome in the adjusted gross revenue (AGR) verdict in the Supreme Court (SC) should provide a new lease of life to Vi. It has upgraded Vodafone Idea stock to 'Add'