Vodafone Idea Telecom Infrastructure, a fully owned subsidiary of Vodafone Idea, has reduced its planned bond issue size from ₹5,000 crore to ₹3,200 crore, aiming to finalize the placement by December 2025. The move seeks more affordable financing options to fund expansion amid ongoing regulatory and financial challenges.
Vodafone Idea’s infrastructure arm, Vodafone Idea Telecom Infrastructure, has trimmed its bond fundraising target to approximately ₹3,200 crore (about $359 million) from the initial ₹5,000 crore, as per insiders knowledgeable about the matter. This decision aligns with expectations of securing cheaper debt from lenders and optimizing the company’s capital structure.
The funds will be raised largely through two-year bonds yielding close to 12%, with the balance via three-year and two-month bonds at around 14% yield. Both bond issues will feature a call option after one year and will be backed by Vodafone Idea . The company is considering tapping private credit funds for these bonds, earmarked primarily for expansion initiatives.
Vodafone Idea faces challenges meeting outstanding spectrum and revenue-sharing dues adjusted after the Supreme Court’s 2019 ruling on AGR dues. The Indian government has converted part of these dues into equity, raising its stake in Vodafone Idea to 48.99%. The company is optimistic about raising additional funding from banks in 2026, expecting these sources to be more cost-effective than bond issuances.
Key Highlights
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Vodafone Idea Telecom Infrastructure cuts bond issue size to ₹3,200 crore from ₹5,000 crore
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Bond structure includes 2-year bonds at ~12% yield and 3-year plus 2-month bonds at ~14% yield
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Both bonds have a call option after one year and are backed by Vodafone Idea Limited
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Funds targeted for infrastructure expansion amidst regulatory and financial challenges
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Government equity conversion raised its stake in Vodafone Idea to 48.99%
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Company plans to seek cheaper bank funding in 2026 following government AGR relief review
Source: Reuters, Moneycontrol, Business Line, Market Screener