Shares of Vodafone Idea (VIL) increased by 1% to Rs 16.38 per share on June 14 after the company approved issuing shares worth up to Rs 2,458 crore on a preferential basis to Ericsson India, Nokia India, and Networks India.
Over the past three months, Vodafone Idea’s stock has surged more than 23%, compared to a 5% rise in the benchmark Nifty 50 index. The company had previously hit a 52-week high of Rs 18 per share on January 1, 2024.
The approved transaction involves issuing up to 166 crore fully paid-up equity shares of face value Rs 10 each in one or more tranches. Specifically, 102.7 crore equity shares at an issue price of Rs 14.8 each will go to Nokia Solutions and Networks India, and 63.3 crore equity shares at the same price will be issued to Ericsson India.
Vodafone Idea’s board also approved an extraordinary general meeting on July 10, 2024, to approve these matters.
“Nokia and Ericsson both have a long-term partnership with VIL as key suppliers of network equipment. This preferential allotment will enable VIL to clear part of their outstanding dues and bolster VIL’s capex rollout for building a top-quality 4G and 5G network, contributing to India’s digital transformation,” said Vodafone Idea in a statement.
As of 11:45 am, the shares were trading 0.81% higher at ₹16.20.
After this preferential issuance, Nokia and Ericsson will hold 1.5% and 0.9% of the company’s shares respectively. The promoters, ABG and Vodafone, will have a 37.3% stake, the Government of India will hold 23.2%, and the remaining 37.1% will be public shareholding.
