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Vodafone Idea’s $3.6B Network Expansion Deal with Nokia, Ericsson, Samsung

वोडाफोन आइडिया

वोडाफोन आइडिया

 

 

Shares of Vodafone Idea soared by 8.96% on Monday. This increase followed the company’s announcement of a ₹30,000 crore ($3.6 billion) deal with Nokia, Ericsson, and Samsung. The deal will provide network equipment over the next three years. It marks a significant step in Vodafone Idea’s plan to enhance its 4G and 5G capabilities across India.

Vodafone Idea’s Stock Rallies:

On Monday morning, the share price jumped by 6.3% to ₹11.14 on the BSE and NSE. Later, it climbed even higher to ₹11.35. This surge in investor interest comes as Vodafone Idea finalizes its largest deal of the year with Nokia and Ericsson, alongside new partner Samsung.


 

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Expanding 4G and 5G Coverage:

The ₹30,000 crore contract is the first step in Vodafone Idea’s larger capital expenditure (capex) plan of ₹55,000 crore ($6.6 billion). This capex plan focuses on expanding Vodafone Idea’s 4G coverage from 1.03 billion to 1.2 billion people and launching 5G services in key markets. The move also aims to increase capacity in response to rising data demands.

According to the company, the newly awarded contracts will help enhance its network infrastructure and start rolling out 5G in select areas by the next quarter.

CEO Highlights Growth Strategy:

Vodafone Idea CEO Akshaya Moondra expressed excitement about this new chapter for the company, stating, “We have entered the investment phase of VIL 2.0. We are well-positioned for a smart turnaround to capitalize on industry growth opportunities.” He emphasized that while Nokia and Ericsson have been with Vodafone Idea since the beginning, they are equally excited to welcome Samsung onboard as they enter the 5G era.

Moondra added that the company’s top priority is expanding its 4G coverage to reach 1.2 billion Indians and rolling out 5G in major markets.

Boosting Capacity and Efficiency:

The new network equipment from the deal is expected to deliver more than just wider coverage. Vodafone Idea mentioned that the advanced technology from Nokia, Ericsson, and Samsung will improve energy efficiency, leading to lower operating costs.

In the short term, Vodafone Idea has already initiated some quick-win capital expenditures, boosting its network capacity by 15%. This resulted in a population coverage increase of 16 million people by the end of September 2024.

Long-Term Funding and AGR Dues:

Vodafone Idea is also working on securing long-term financing for its expansion plans. The company is in advanced discussions with existing and new lenders to arrange ₹25,000 crore in funds and ₹10,000 crore in non-fund-based facilities.

Meanwhile, Vodafone Idea’s AGR (Adjusted Gross Revenue) dues stand at ₹70,300 crore, following a recent ruling by the Supreme Court that dismissed the telecom industry’s petitions regarding the calculation of AGR dues.

The Department of Telecommunications (DoT) can now include all non-telecom revenue in its calculations.

Vodafone Idea’s senior management, including CEO Akshaya Moondra and CFO Murthy GVAS, will discuss the company’s AGR dues and other financial matters with analysts during a conference call on Monday.

 

Vodafone Idea takes a critical step forward with its ₹30,000 crore network equipment deal. This move aims to expand 4G coverage and introduce 5G services. The investment supports a larger strategy to improve network quality and lower operational costs. It also helps Vodafone Idea remain competitive in India’s rapidly growing telecom market. Despite ongoing financial challenges, including large AGR dues, Vodafone Idea positions itself for a new growth phase. The company has the backing of key global partners.

 

 

 

 

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