Davos WEF 2022 | Kumar Mangalam Birla Says Worst Is Behind Vodafone, Need Some More Patience
The worst is behind Vodafone Idea Ltd. and now it's to be “patient” and wait for “things to work out well”.
That's according to Kumar Mangalam Birla, chairman at Aditya Birla Group, which co-owns the telecom operator with Vodafone Plc. He said the group is “as of now very committed” to remain invested in the struggling carrier.
“The most important thing to do now is to tie up funding, for which discussions are happening with investors around the world. Not the easiest to happen because the company was in trouble as we all know,” Birla told BQ Prime's Menaka Doshi on the sidelines of World Economic Forum 2022 summit at Davos.
“It takes some time to get people to start feeling confident about a business like that again. [But] The operational performance seems to improve quarter-on-quarter. The government package is a huge help for the entire sector. It's also a vote of confidence that the government has sort of signaled in the sector. So, I do think the worst is behind us.”
Birla said they never really had given up on Vodafone Idea. “But we didn't want to invest in a business unless we were convinced that there would be a return to that investment, at least a fair amount of return to the investment,” he said. “There seems to be a turnaround now in the sector.”
The intent, he said, is to “find a financial partner or a strategic partner” to invest in the company.
Earlier this year, Vodafone Idea decided to convert interest on spectrum instalments and adjusted gross revenue dues into equity, giving the Indian government nearly 36% stake in the carrier.
The final response from the government on equity allocation, however, “is in the works”, said Birla.
“It just requires some more patience. We will have to see how things pan out. I am very positive about it, but it's one of those situations where you can't make things happen. You just have to wait. You know that things will work out well. I can't set a timeline to it because there are so many other people and agencies involved.”
Watch the full interview here:
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