Vodafone share price surges 15%, hits 52-week high; here’s why

According to trendlyne data, Vodafone shares has gained 75.44% from 52-week low of 5.7 recorded on March 31, 2023. Rajesh Bhosale – Equity Technical and Derivative Analyst, of Angel One, said that the last 2 weeks has been specatular for this underperforming counter, this week itself we are seeing a 14% upmove and has broken below recent hurdle of 9.

This upmove may extend with potential target of 12.4 , the levels are around 9 is likely to act as support.

After receiving an extension to issue Optionally Convertible Debentures (OCDs) to ATC, the stock was in focus last week.

On Monday, August 28, the company said that ATC have agreed to extend the period of redemption of 8000 OCDs from 6 months, from the date of allotment of first tranche of OCDs (which was falling due on 28th August, 2023), to 18 months from the date of allotment, subject to certain conditions as mutually agreed, according to exchange filing.

Optionally convertible debentures are debt securities which let issuer to raise capital. In return the issuer pays interest to the investor till the maturity. In this case, investors have the right to convert the debt into equities of the issuing company. The price of the equities is decided at the time of the issue.

Also Read: Vodafone Idea extends OCD redemption allotted to ATC by one year

In February, Vodafone Idea’s shareholders have approved the preferential issuance of up to ₹1,600 crore of optionally convertible debentures to vendor American Tower Corp (ATC), according to a regulatory filing.

According to the voting results, overall 99.99 per cent of the votes were in favour of the resolution, which pertained to issue of optionally convertible debentures of up to ₹1,600 crore to American Tower Corp.

Also Read: Vodafone Idea’s shareholders approve issuance of ₹1,600 crore optionally convertible debentures to ATC

The company’s management stated in its earnings call last week that its equity fund raising exercise will end in the December quarter and that debt funding will come after.

“As far as debt funding is concerned, we have been engaged with a consortium of banks for a long time. Generally, their ask is that equity also needs to be tied up. So, as we already disclosed that the promoters have already given support for Rs. 2,000 crores of equity, some external equity needs to be tied up. And with that, the bank funding will also be tied up. So, we expect to conclude all these funding arrangement in the coming quarters.

And once that happens, then we will be able to continue our investments. Any specific capex guidance, we will be able to give only after that is tied up. Until then, our current level of capex, which we are incurring in the last quarter, would be a representative level of capex for us,” said Akshaya Moondra – CEO of Vodafone Idea Ltd in Q1FY24 earnings call.

Updated: 01 Sep 2023, 03:35 PM IST