Vodafone Idea zooms ~10% after $3.6 Billion deal

23 Sep 2024 , 11:04 AM

Vodafone Idea’s shares rose 9.93% to a day’s high of ₹11.61 on the BSE after the company announced on Sunday that it had signed $3.6 Billion (₹30,000 Crore) deals with Nokia, Samsung and Ericsson to source telecom equipment over three years for 4G network expansion and 5G rollouts.

This agreement is a key step for the corporation in improving its market competitiveness against stronger rivals Reliance Jio and Bharti Airtel, as well as reducing subscriber losses.

The company, which recently generated ₹24,000 Crore by selling shares, declared that the transaction is the first step towards the implementation of its “transformative” three-year capex plan of ₹55,000 Crore. This plan seeks to increase 4G population coverage from 1.03 billion to 1.2 billion, introduce 5G in major countries, and allow for capacity expansion in accordance with data growth.

While the corporation did not comment on the individual transactions, it is expected to award 40% to Ericsson and Nokia, with the remaining 20% to Samsung, as previously reported.

Supplies under the network agreements are slated to begin arriving in the coming quarter, with boosting 4G coverage being the company’s first goal.

At around 10.48 AM, Vodafone Idea was trading 6.21% higher at ₹11.12, against the previous close of ₹10.47 on NSE. The counter touched an intraday high and low of ₹11.27, and ₹10.96, respectively.

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