The Vodafone Idea group has approached the government-run State Bank of India (SBI) for a fresh loan. The loan amount requested by the group has not been revealed yet.

The public lender has asked the cash-strapped wireless operator to present a turnaround strategy, detailing its cash conservation plans, tariff outlook, and a road map to return to profits, according to a Bloomberg report.

While the telco is drafting these details, there’s no certainty if the public lender would sanction the loan as the SBI already has the highest debt exposure to Vodafone Idea (VI). Therefore, it is being said that if SBI approves the loan, it will pave the way for other banks to offer credit and boost survival chances of the loss-making telco.

The loan request comes at a time when the group has sought the telecom department's nod to defer the payment of its quarterly licence fees and spectrum usage charges for the second, third and fourth quarters of this fiscal year. The telecom department is yet to respond to the request.

The telecom has not been able to record an annual profit since 2016 when Mukesh Ambani-led Reliance Jio rolled out 4G data plans at a competitive price. Vi has been losing its subscribers at a rapid pace ever since.

In fact, the telco would have gone for insolvency settlement had the Centre not announced a four-year moratorium on adjusted gross revenue (AGR) and spectrum payments in September this year. The total gross debt — including the AGR-related dues and deferred spectrum payment obligations — of the company was estimated at a staggering Rs 1,91,590 crore, as of June 30, 2021.

The telco recorded a consolidated loss of Rs 7,319 crore in the first quarter of 2021-22. The second-quarter results of the company are expected to be released later today.

(Edited by : Anshul)

First Published:Nov 12, 2021 12:34 PM IST