Multiple domestic and global investors including JSW Group and Singapore-based ST Telemedia are exploring a potential stake in the telecom operator, according to a report. The discussions are said to be exploratory in nature,

Shares of Vodafone Idea Ltd rose as much as 5 percent in early trade on Monday before partially easing off, as a news report said multiple domestic and global investors -- including JSW Group and Singapore-based ST Telemedia -- are exploring a potential stake in the telecom operator. The Vodafone Idea stock was trading at Rs 9.46 in morning trade, up about 2.05 percent, after rising as much as 5.1 percent intraday. Over the past year, the stock has gained around 36.2 percent.

According to a report by The Economic Times, Singapore-based ST Telemedia and India’s JSW Group have joined a few other domestic and global investors in discussions with the debt-laden telecom operator for acquiring a potential stake. US-based Tillman Global Holdings is also among the investors evaluating the opportunity.

The discussions are said to be exploratory in nature, and there is no certainty of a transaction at this stage. Vodafone Idea’s management is scheduled to meet institutional investors in Singapore and Hong Kong on March 16-17, the report said.

Investor interest comes after the company received significant financial relief from the government, which is currently its largest shareholder. The Centre holds nearly 49 percent stake in Vodafone Idea following the conversion of some statutory dues into equity.

The government has been seeking a strategic investor that could bring in fresh capital and help run the telecom operator, which continues to face heavy debt and intense competition from Bharti Airtel and Reliance Jio. Promoters Aditya Birla Group and Vodafone Group Plc currently hold 9.5 percent and 16.07 percent stakes in the company, respectively.

Brokerage estimates cited in the report suggest that if a strategic investor injects around Rs 50,000 crore of fresh equity, the government could convert roughly Rs 48,000 crore of spectrum liabilities into equity without increasing its stake beyond 49 percent. Such a move could potentially reduce the company’s spectrum liability by about 40 percent, easing its financial burden.

Fresh capital is considered crucial for Vodafone Idea as it seeks to expand its 5G network and arrest market-share losses. The company currently offers 5G services in over 30 cities, but its rollout remains limited compared with rivals Airtel and Jio.

Vodafone Idea remains the third-largest telecom operator in India with about 17 percent market share, and analysts say additional funding will be critical for upgrading its network and sustaining operations in the capital-intensive telecom sector.