Struggling with AGR dues, Vodafone Idea eyes non-banking funds to keep its 5G rollout alive, as bank loans hinge on clarity before March 2026.
Vodafone Idea (Vi) is exploring short-term non-banking funding options to sustain its ongoing capital expenditure cycle. This comes as talks with banks for a larger debt raise remain delayed due to regulatory uncertainties around adjusted gross revenue (AGR). Outgoing chief executive officer Akshaya Moondra outlined the strategy during the company’s earnings call on Monday.
Moondra said the alternative funding would be smaller than the ₹250 billion debt being sought from banks but would allow Vi to maintain continuity in its CapEx plans. The telecom operator has been implementing an investment cycle since last year, with a three-year capital programme of ₹500–550 billion, primarily focused on nationwide 5G rollout across its 17 spectrum circles.
The company had raised ₹180 billion through a follow-on public offering (FPO) in April 2024 and had indicated a further ₹350 billion in external debt requirements. The current expenditure of around ₹50–60 billion as of September is expected to be funded from FPO proceeds.
However, Moondra emphasised that significant future investments would depend on fresh funding.
While discussions with banks are progressing, the CEO noted that the process may take longer. He stressed that non-banking sources could help bridge the gap in the meantime.
The AGR liability remains the key hurdle. Vi currently faces dues of about ₹75,000 crore, including an instalment of ₹164.28 billion due by March 2026 and another ₹26.41 billion towards deferred spectrum payments by June 2026.
Moondra expressed optimism that the government would support the industry, citing earlier relief measures such as spectrum payment deferments in 2019, sector reforms in 2021, and conversion of government dues into equity in 2023 and again in 2025, which made the government the largest shareholder in Vi.
The company is pressing for clarity on AGR before March 2026 to unlock bank lending. If resolved earlier, it will give confidence to lenders and accelerate funding, Moondra added.
His tenure as CEO concluded on Monday, with Abhijith Kishore announced as his successor.
