Senior executives at large public sector banks said the government’s moratorium has provided lenders with some comfort on incremental exposure to Vodafone Idea, though formal discussions with the company are yet to begin. Bankers said the relief could improve the viability of fresh funding proposals.
“Things have become favourable after the government’s decision. This is a positive development,” said a banker with a large public sector bank.
Another banker added that they will assess the situation, but things do look better from hereon.
Viability Boost: Rescheduling Dues to Ease Immediate Cash Stress
Vodafone Idea has been in talks to raise about Rs 25,000 crore, and public sector banks may evaluate participation after reviewing the government’s order in detail.
However, some bankers PSBs will be a little more cautious now given the company has been losing subscribers and revenue market share for the past several quarters.
Currently, the SBI-led consortium has a total exposure of Rs 11,000 crores to the company which includes term loans as well as working capital loans across fund and non-fund based exposures.
Subscriber Churn and the Rs 2.17 Lakh Crore Debt Overhang
However, the total debt of Vi is Rs 2.17 lakh crore out of which Rs 1.9 lakh crore are dues to the government for spectrum and adjusted gross revenue.