What Vodafone-Idea CEO said on the government selling its stake in the company

Telecom operator Vodafone Idea (Vi) has dismissed rumors of the government offloading its stake in the company. While reports suggest the government is exploring options with sovereign wealth funds, Vi CEO Akshaya Moondra stated that the company has received no official communication regarding this matter.

According to a report in news agency PTI, Moondra said, "We have had no communication with the government...to that extent, we have to say that government as a public shareholder...they are free to take decision with respect to their investment. That is an independent subject."

Moondra clarified that the government, as a public shareholder, has the autonomy to decide the future of its investment. However, he emphasized that any potential stake sale is independent of the government's support for the telecom sector through the conversion of dues into equity.

"Reforms package was announced with the objective of saying support needs to be provided and the government is very clearly focused on having three healthy private operators...The conversion to equity was a means of supporting balance sheet of the company by converting some debt into equity. I would say, the policy of the government remains the same, what they do with their public shareholding is their decision... we as a company do not have any information or engagement with them on this subject," Moondra added.

The company reported a narrowed loss of Rs 6,432.1 crore for the June quarter, primarily driven by increased 4G subscriber additions. Despite this, revenue dipped slightly to Rs 10,508.3 crore.

Vi has been focusing on expanding its 4G network and is gearing up for 5G launch after recently raising Rs 24,000 crore in equity funding. Post these fundings, the promoters' stake stands at 37.2%, while the government's holding is at 23.1%.

Port outs to BSNL have increased
Vodafone-Idea CEO also said that there has been a slight increase in port-outs to BSNL due to its unchanged tariffs, Vi believes that customers will eventually return to the company for better 4G coverage. "One of the trends we have seen is that the port-out to BSNL has generally risen from pre-tariff increase levels, which is a space we are watching...and the reason for that is because they (BSNL) has not increased their tariffs so there is a fair amount of arbitrage," he said.

The VIL CEO, however, believes that any decision to port out purely on the basis on tariffs may not sustain.