Equity delay left Vodafone Idea with fewer users and higher debt

16-mnth hold-up: User base down by a tenth, Ebitda margins squeezed, losses pile up

The more than 16 months of back and forth between the government and the promoters of Vodafone-Idea (Vi), before the latter agreed to convert part of its dues into equity last week, has had an adverse impact on the company.

The delay has cost Vi dearly in lost subscribers, rising subscriber churn, and a growing  debt burden, reducing Ebitda margins, and pushing up the losses on the balance sheet.

On September 15, 2021, the Cabinet had cleared a package for financially-stressed telecom firms in which the government offered them an option to convert part of the interest from deferred dues