Vodafone Idea shares jump 8% today; here's what analysts say

Shares of Vodafone Idea Ltd rose sharply in Monday's trade. The stock has jumped 7.55 per cent to hit a day high of Rs 14.24. It was last seen trading 5.06 per cent higher at Rs 13.91. At this price, the scrip has gained 126.18 per cent in the past one year.

The telco's board has recently allotted equity shares worth Rs 1,440 crore from optionally convertible debentures, or OCDs, to ATC Telecom Infrastructure. Shareholding of ATC in Voda Idea stands at 2.9 per cent after the conversion.

Earlier, it had annnounced plans to raise around Rs 45,000 crore via a combination of equity and debt. It also approved equity fundraise of up to Rs 20,000 crore.

"The telco will call for a meeting of its shareholders on April 2, 2024, and post-shareholder approval it expects to complete the equity fundraise in the coming quarter. The promoters will also participate in the proposed equity raise," the operator had stated.

VIL highlighted that the equity and debt fundraising will enable it to make investments towards significant expansion of 4G coverage, 5G network rollout and capacity expansion.

Telco's chief executive Akshay Moondra hoped that VIL could roll out its 5G services within six to seven months after it raises funds.

On technical setup, the counter traded higher than the 5-day, 10-, 20-, 150-day and 200-day simple moving averages (SMAs) but lower than the 30-day, 50-day and 100-day SMAs. The counter's 14-day relative strength index (RSI) came at 52.35. A level below 30 is defined as oversold while a value above 70 is considered overbought.

"The stock has indicated a pullback. A decisive breach above Rs 14.12 level is required for further rise in the coming days. Then, expected targets would be Rs 16.40 and Rs 18.40. Major support will be at Rs 11.90," said Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher.

The counter looked strong on daily charts. And, expected near-term target would be Rs 16. Keep stop loss placed at Rs 12.50," said Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking.

As of December 2023, promoters held 50.36 per cent stake in the company.