Vodafone Idea Approves Resolution To File RHP For Rs 18,000-Crore FPO, Shares Fall
The stock fell as much as 5.02% to Rs 12.30 apiece, the lowest since March 14.
Vodafone Idea Ltd. has passed a resolution to file a red herring prospectus for its upcoming follow-on public offer to raise up to Rs 18,000 crore, according to an exchange filing dated April 11. In a board meeting on Thursday, the company agreed to approve, adopt and file the document with the Registrar of Companies, Gujarat, the statement read.
During the meeting, the board inter-alia passed resolutions for the following:
Approving the bid/offer opening date to be April 18.
Approving the bid/offer closing date to be April 22.
Approving the anchor investor bid/offer period to be April 16.
In a separate filing on Friday, Vodafone Idea said it has approved a price band of Rs 10-11 for its upcoming offer. This represents a discount of 15% to 22.7% from the Wednesday's close of Rs 12.93 per share.
NDTV Profit previously reported that the company is planning to launch a follow-on public offering next week to raise as much as Rs 20,000 crore, according to people aware of the development.
The cash-strapped telecom operator has finalised anchor investors, the people said without providing the further details regarding the anchor investors. The investors likely involve private equity funds. The Aditya Birla Group’s telecom operator is planning to use the funds raised through FPOs largely for infrastructure investments, the people added.
The capital raising committee is scheduled to be held on Friday to consider and approve, among other things, the price band and discount, if any, as permitted under the provisions of the SEBI ICDR Regulations, the filing added.
On the NSE, the stock fell as much as 5.02% to Rs 12.30 apiece, the lowest since March 14. It was trading 4.25% lower at Rs 12.4 per share, compared to a 0.49% decline in the benchmark NSE Nifty 50 as of 10:15 a.m.
The share price has fallen 22.55% on a year-to-date basis but risen 77.7% in the last 12 months. The total traded volume so far in the day stood at 0.85 times its 30-day average. The relative strength index was at 35.88.
Out of the 17 analysts tracking the company, three recommend a 'hold' rating on the stock and 14 suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 43.9%.
