Vodafone Group’s investment value in Vodafone Idea is nil

The UK-based telecom operator, Vodafone Plc said that the carrying value of the Vodafone Group's investment in its India entity - Vodafone Idea (VIL) is nil.

In the FY23 preliminary results, Vodafone Plc said that it is recording no further share of losses in respect of VIL.

The group mentioned that VIL still requires additional liquidity support from its lenders and intends to raise additional funding.

“There are significant uncertainties in relation to VIL's ability to make payments in relation to any remaining liabilities covered by the mechanism and no further cash payments are considered probable from the Group as of March 31, 2023," it said.

The group’s potential exposure to liabilities within VIL is capped by the mechanism described above; consequently, contingent liabilities arising from litigation in India concerning the operations of Vodafone India are not reported, it added.

Early this year, the government gave a nod to the conversion of over Rs 16,133 crore interest dues of Vodafone Idea into equity. Equity shares of the face value of Rs 10 each were issued to the government at the same price.

The company got relief after the government announced a reform package in September 2021.  

After the merger between Vodafone and Idea into a single entity, the operator became the biggest telecom operator with a subscriber base of 43 crore which accounts to 35% market share in 2018. Now, the debt-ridden company has slipped to be a distant third telecom operator.