MUMBAI (TIP): In the largest foreign direct investment in the country since Narendra Modi-led BJP came to power in 2014, Vodafone Plc, Europe’s biggest mobile service provider, has infused Rs 47,700 crore ($7.5 billion) in its Indian arm, empowering the company with more ammunition to defend its turf in the world’s second largest telecommunications market where competition has intensified with the entry of Reliance Jio.
Vodafone India, the No.2 player with 200 million subscribers behind Bharti Airtel, will be using the funds to ramp up its network and participate in the upcoming radio airwaves auction. The announcement came eight days ahead of the launch of the biggest-ever spectrum auction and 17 days after the launch of Reliance Jio, which is emerging to be the biggest rival for the incumbent mobile service providers.
“This equity infusion will be used for right-sizing our spectrum portfolio, expansion of network and deployment of next-generation 4G and 5G technologies,” said Sunil Sood, MD & CEO, Vodafone India.
Reliance Jio, controlled by billionaire Mukesh Ambani, has stormed the market with free calls and rock-bottom data tariffs, pressuring incumbent telecom operators to rethink their strategies to protect their market share. Vodafone India is expected to be the most aggressive bidder at the ensuing spectrum auction with analysts predicting it to spend as much as Rs 16,300 crore for buying airwaves.