Vodafone Idea shares saw a decline on Wednesday as its board of directors’ decision to raise ₹45,000 crore failed to convince investors of the stock’s long-term growth, leading to profit-booking.

What Happened: The telecom operator plans to raise ₹20,000 crore through equity or equity-linked instruments and the remaining amount through debt, with participation from promoters, the firm said.

The company intends to convene a shareholders’ meeting on April 2 to seek approval for the equity fundraise, aiming to complete it in the coming quarter.

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Since the announcement of the board’s consideration of a fundraise on February 22, the company’s shares have gained 5.2%.

According to the company’s filing with the bourses, the proposed fundraise comes after notable improvements in operating metrics, with consecutive growth in its 4G subscriber base and average revenue per user (ARPU) over the last 10 quarters.

In the third quarter of fiscal year 2023-24, Vodafone Idea reported a net loss of ₹6,985.9 crore, marking a decrease of 12.56% compared to the same period the previous year. However, its revenue increased by 0.49% to ₹10,673.1 crore from the year-ago period.

Price Action: Vodafone Idea’s share price was down 9.78% at ₹14.30 in morning trade on Wednesday.

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