Vodafone Idea Shares Gain After Board Approves Raising Rs 2,075 Crore From Promoters

Shares of Vodafone Idea Ltd. rose over 4% after the telecom major approved issuing shares worth Rs 2,075 crore to promoters.

The cash-strapped telecom company's board approved the issuance of 139.5 crore shares with a face value of Rs 10 each at an issue price of Rs 14.87 per equity share to promoters. The issue price represents a premium of 11% from Friday's closing.

The issuance will be made to Oriana Investments Pte., an entity within the Aditya Birla Group and part of the promoter group, on a preferential basis, in compliance with Chapter V of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018.

Additionally, the board also approved an increase in the authorised share capital of the company from the existing Rs 75,000 crore to Rs 1 lakh crore.

Shares of Vi rose as much as 4.5% during the day to Rs 13.9 apiece on the NSE. It was trading 1.88% lower at Rs 13.05 apiece, compared to a 0.44% advance in the benchmark Nifty 50 as of 10:11 a.m.

The stock has risen 112% in the last 12 months. The total traded volume so far in the day stood at 2.8 times its 30-day average. The relative strength index was at 42.

All 14 analysts tracking Vi have a 'sell' rating on the stock, according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 46.6%.